If the FED wants to correct a recession.then the FED can. __ Lower the discount rate Lower the reserve requirement Buy bonds All of these are correct

ll of these are correct.<br /><br />The Federal Reserve (FED) has several tools at its disposal to address a recession and stimulate economic activity. These include:<br /><br />1. **Lowering the discount rate**: This is the interest rate at which banks can borrow money from the Federal Reserve. Lowering this rate makes borrowing cheaper for banks, which can then lend more to businesses and consumers, stimulating spending and investment.<br /><br />2. **Lowering the reserve requirement**: This is the amount of funds that banks must hold in reserve against deposits. Lowering the reserve requirement frees up more funds for banks to lend out, increasing the money supply and encouraging economic activity.<br /><br />3. **Buying bonds**: This is part of open market operations where the FED buys government securities (bonds) from the market. When the FED buys bonds, it increases the money supply by injecting liquidity into the banking system, which lowers interest rates and encourages borrowing and spending.<br /><br />By using these tools, the FED aims to increase the money supply, lower interest rates, and stimulate economic growth, thereby helping to correct a recession.