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Suppose that the FR Bank raises the required reserve ratio for commercial banks, but does this for reasons other than trying to change the federal

Suppose that the FR Bank raises the required reserve ratio for commercial banks, but does this for reasons other than trying to change the federal funds rate, which was below the discount rate prior to the policy change. If the FR Bank wants a defensive operation to counter the change in the interest rate, it can
Answer

A. buy securities

B. raise the discount rate

C. sell securities

D. none of the above

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Finance-8097419.doc

Suppose that the FR Bank raises the required reserve ratio for commercial banks, but does this
for reasons other than trying to change the federal funds rate, which was below the discount rate...

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