The Fed's initial step in pursuing restrictive monetary policy using the federal funds rate is to
A)announce a higher target.
B)sell bonds to banks and the public.
C)raise the discount rate.
D)raise the prime interest rate.

Question

Quizplus · Accepted Answer

The Fed's initial step in pursuing restrictive monetary policy is to announce a higher target for the federal funds rate, which signals its intention to tighten monetary policy.

The Fed's Initial Step in Pursuing Restrictive Monetary Policy Using