The Federal Reserve (the Fed) is the central banking system of the United States. One of it functions is to manage the nation's money supply through monetary policy in order to maintain the stability of the financial system and the economy.
The Fed had the power<em> to increase the money supply</em>. If the Fed believes that the economy is operating well below its potential level of output, the money supply is <em>increased in order to stimulate the output and employment</em>. Output is the quantity of services and goods produced.
To increase the money supply means that people will have <em>more or excess</em> <em>money</em> to spend. Consumption will <em>increase</em>, people will demand more goods and services. Some may want to deposit the excess money in banks making the bank's excess reserves richer ( banks will own more money). If the banks own more money, they are willing to lend more. Banks will<em> lower</em> <em>interests rates</em> to motivate borrowing.
As the result of increased consumption and investment ( more money available, lower interests rates ) the country's<em> GDP will increase</em>. GDP is the market value of all the goods and services produced in the USA during a specific time.
Answer:
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Explanation:
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A if I am correct please correct me if I am wrong
The correct answer should be Seattle, as it is the only city actually located in the state of Washington
