Final answer:
False, raising the Federal Reserve discount rate makes it harder, not easier, to borrow money, as it encourages banks to call in loans and reduce borrowing from the Fed, which leads to higher interest rates and a tighter money supply.
Step-by-step explanation:
When the Federal Reserve Board (Fed) raises the discount rate, it actually makes it more difficult to borrow money. This is because a higher discount rate means commercial banks are less inclined to borrow reserves from the Fed, and may call in loans to replace those funds.
The result is a decrease in the money supply and higher market interest rates. On the contrary, lowering the discount rate would make it easier for banks to borrow and thus stimulate lending. Nowadays, discount loans by the Fed are not as common, with banks often borrowing from other sources before turning to the Fed. Also, the Fed has found open market operations to be a more effective tool for conducting monetary policy.