Question

What monetary policies should the Federal Reserve enact to combat higher inflation rates for consumer goods and services? (1 point)

Enact contractionary monetary policies to increase money supply.
Enact expansionary monetary policies to decrease the money supply.
Enact expansionary monetary policies to increase the money supply.
• Enact contractionary monetary policies to decrease the money supply.

Answer 1

[AI-generated answer — Bot GPT 3.5]

Enact contractionary monetary policies to decrease the money supply. This could include raising interest rates, selling government securities, and increasing reserve requirements for banks. By reducing the amount of money available in the economy, the Federal Reserve can help curb inflationary pressures on consumer goods and services.