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What actions would the FOMC likely take if it were to pursue contractionary monetary policy using open market operations? a. Raise the prime rate

BLower the required reserve ratio

CLower the discount rate

DSell government securities

Verified Answer :

Clower the discount rate

chilljain33

Lowering the discount rate is one of the actions that needs to be taken by the FOMC if it wishes to pursue contractionary monetary policy using open market operations. Hence, option C holds true.

What is a contractionary monetary policy?

A contractionary monetary policy is a policy implemented by the authorities to control the situation of an economy. This is done by lowering or decreasing the supply of money in an economy.

One of the ways to decrease the supply of money in the market of an economy is by lowering the rates of discount. Low discount rates discourage the banks.

Hence, option C holds true regarding contractionary monetary policy.

Learn more about contractionary monetary policy here:

https://brainly.com/question/28038989

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