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How does the money supply change as a result of (a) an increase in the discount rate,?

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  • How does the money supply change as a result of (a) an increase in the discount rate,?


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Answer #1 | 23/12 2013 16:39
The banking system can borrow money from the FED more if the discount rate is low.Then it can create more fiat money by lending out because its reserves have increased.
Positive: 55 %

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