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Social Studies, 31.10.2020 08:00 qveenvslayin

Why is raising the interest rate on reserves considered a contractionary monetary policy?
A. It causes banks to lower their prime interest rate in response.
B. It makes it more expensive for businesses to hire new employees.
C. It prevents investors from withdrawing their money from banks.
D. It encourages banks to keep money in reserve instead of lending
it.

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Why is raising the interest rate on reserves considered a contractionary monetary policy?
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