True/False. When the FED wants easier credit, one of the things it can do is to raise dicount rate.?

Answer 1

False. Your statement makes no sense - wants easier credit? what does that mean?

Read here:
http://www.federalreserve.gov/monetarypolicy/discountrate.htm
http://money.howstuffworks.com/fed.htm

Answer 2

Your question is kind of confusing... It sounds like the Fed wants credit. The Fed doesn't need credit.

If what you are saying is 'the Fed wants the economy to have access to more (cheaper) credit' then it would be false. The Federal Reserve (Fed) raises interest rates to slow the economy down (to keep inflation in check)
If the economy is too slow, they lower rates (cheaper/easier credit) to get people to start buying more things. Over the past few years, they have been raising it. But recently, they have held it steady, and might lower it.

Answer 3

False, if the fed wants "easier credit" I assume you mean that they want to make it easier for the average consumer to borrow money. The only way to do this is to make money cheaper. Increasing the discount rate will increase all other rates and therefore make money worth more (encourage savings, derail inflation).

Answer 4

Im only guessing but the Fed made it easier for consumers to borrow since 2002 by lowering the prime rate. Since it has begun incresing the prime rate its become much harder to borrow.

Answer 5

True. But this is not the only course to take. Our system is very complicated and is strung together as though it were dominoes.