Question

In this scenario, what is the Fed trying to do by increasing interest rates? Check all that apply.

Answer 1

decrease the amount of money that banks have to lend

reduce the amount of available credit

discourage consumer borrowing by increaseing interest rates on loans

Step-by-step explanation:

Answer 2

By increasing interest rates, the Fed is trying to adjust the interest rates that banks charge to borrow from one another, which is usually passed on to consumers.

Few economists say that what the Fed is doing now is a bit unusual ,because its raising rates even though the inflation is quite low.

Banks give loans all the time but with some fee attached to it.When we borrow and pay back with interest, it is how banks make money.

the cost of borrowing & interest rates makes a big impact on which credit card you chose or you get one at all.