- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 4. Monetary Policy
- Subject 3. Monetary Policy Objectives
CFA Practice Question
If the Fed wants to fight recession, it should ______
II. raise the federal funds rate target.
III. increase the supply of money.
IV. decrease the supply of money.
I. lower the federal funds rate target.
II. raise the federal funds rate target.
III. increase the supply of money.
IV. decrease the supply of money.
Correct Answer: I and III
Lowering the federal funds rate target will increase the supply of money.
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