Question

If the u.s. economy is experiencing inflation, then the federal reserve board might -​ question 5 options:

a) lend more money to banks
b) decrease the interest rate
c) increase the interest rate
d) print more money

Answer 1

If the U.S. economy is experiencing inflation, the Federal Reserve Board might choose to increase the interest rate to reduce inflationary pressures and decrease borrowing and spending.

Step-by-step explanation:

If the U.S. economy is experiencing inflation, then the Federal Reserve Board might choose to increase the interest rate. By raising interest rates, the Federal Reserve aims to decrease borrowing and spending, which helps to reduce inflationary pressures. When interest rates are higher, it becomes more expensive for businesses and consumers to borrow money, leading to a decrease in spending and ultimately reducing inflation.