what-is-the-effect-of-a-lower-discount-rate-on-bank-borrowing-and-the-money-supp

Question

What is the effect of a lower discount rate on bank borrowing and the money supply?

Accepted Answer

Banks borrow more, increasing the money supply.

Answer

Banks borrow more, decreasing the money supply.

Answer

Banks borrow less, increasing the money supply.

Answer

Banks borrow less, decreasing the money supply.