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Question
the fed may respond to a recession by
discouraging consumer borrowing
decreasing interest rates.
decreasing government spending
decreasing available credit
To address a recession, the Federal Reserve (Fed) typically uses expansionary monetary policy. Decreasing interest rates (option B) encourages borrowing and spending, stimulating economic activity. Discouraging borrowing (A), decreasing government spending (C, which is fiscal policy, not Fed - monetary), and decreasing available credit (D) are contractionary or not Fed's recession - fighting actions.
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B. decreasing interest rates