Question

Now, write a paragraph explaining how the Fed responded to the financial crisis that began in 2008.

Answer 1

The Fed responded to the crisis by lending money to banks. This ensured that banks had the capital needed to continue daily operations. Additionally, the Fed lowed the federal funds rate. The actions taken by the Fed helped to lower interest rates in order to encourage borrowing and spark economic growth. 

Answer 2

The Fed responded by lending money to banks. It ensured that banks had the capital needed to continue everyday operations. In addition, the Feds lowered the Federal Funds Rate.