If the Fed uses its tools to expand the money supply, bond prices will be bid up and interest rates will fall.

Name: If the Fed uses its tools to expand the money supply, bond prices will be bid up and interest rates will fall.
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When the Fed uses tools such as buying bonds or lowering the reserve requirement, it injects liquidity into the economy, which increases the money supply. As a result, demand for bonds will increase, bidding up their prices and lowering their yields or interest rates.

If the Fed Uses Its Tools to Expand the Money