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Which is the Fed MOST likely to do in the event of a recession?

A Buy treasury bonds on the open market.
B Sell treasury bonds on the open market.
C Raise the discount rate.
D Raise the reserve requirement.

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In the case of a recession, the Fed is MOST LIKELY to increase the reserve requirement.

Which action by the Fed there in event of a downturn is most likely?

In the event of severe economic downturns, the Fed may adopt drastic measures to reduce unemployment and boost prices in order to achieve its traditional purpose and give immediate assistance to the American financial sector and economy.

What occurs if the Fed increases the minimum reserve ratio?

In the absence of additional measures, raising the reserve requirement ratios reduces the amount of deposits that may be supported by a certain level of reserves, lowers the money supply, and rises the credit cost.

To know more about reserve requirement visit:

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