Which statement best describes how the fed responds to recessions? it sells more securities. it charges banks more interest. it increases reserve requirements. it increases the money supply.

It increases the money supply is the correct answer. The Federal reserve was created in 1913 to stabilize economic turbulence by providing capital to the financial institututions of the USA as well as other actors in the market. It can also increase or decrease interest rates according to the circumstances.

Fed response to recession can be best described by the statement that it increases the money supply.  

Further explanation: The United States of America's central banking system is the Federal Reserve System which was created in 1913 following a series of panics that were centrally financial in nature. The main motive behind its formation was to combat financial insecurities. The Great Depression on 1930 and the Great Repression of the 2000s have boosted its expansion and increased its responsibilities.  

The Great Recession was a phase of decline in the economic sectors of the world that lasted from 2000 to the early 2010s. While the timing and the scale of the recession varied depending on the country's ability to deal with it, the overall impact remained the same. After Great Depression, it was considered as the 2nd worst downturn that affected almost all the countries of the world.  

The recession in the United States began from December 2007 and came to an end around June 2009. During this phase, debts increased tremendously and this can be ascertained from the case where debt held by the public grew from 35% GDP to 77% GDP while the government's expenditure skyrocketed and the private sector reduced the burden of the debt.  

It was found out later one that certain policies of the government or even the absence of them in some cases were mainly responsible for the Great Recession.  

Learn more:

1.The 1930s dust bowl in the great plains was caused by?

2.Willie Mays began his professional career in 1948 with a team that has what three letter in the middle circle of their logo?

3.During reconstruction, southern agriculture?

Answer details:

Subject: U. S. History

Grade: High School

Chapter: Great Recession in the U. S.  

Keywords: Central Banking system, Great Depression, Great Recession, Federal Reserve System, expansion of roles and responsibilities, economic sector, 2nd worst downturn, 35% GDP to 77% GDP

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