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An important reason why the Federal Reserve would not want to keep interest rates at 0% forever is that:
a) it restricts the money supply, making it harder for banks to lend money.
b) it limits the ability of the Fed to use expansionary monetary policy when the next recession occurs.
c) it makes borrowing for homes and major purchases more expensive.
d) it raises the possibility of higher unemployment because lower interest rates slow economic growth.

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ogorwyne

An important reason why the Federal Reserve would not want to keep interest rates at 0% forever is that: it restricts the money supply, making it harder for banks to lend money. Option A.

What is the federal reserve?

The United States of America's central banking system is called the Federal Reserve System. With the passage of the Federal Reserve Act on December 23, 1913, it was established in response to the need for centralized control of the monetary system to prevent financial crises following a string of financial panics.

The interest rate at which depository institutions overnight lend reserve holdings to other depository institutions on an uncollateralized basis is known as the federal funds rate in the United States. Reserve balances are sums kept at the Federal Reserve to satisfy the reserve requirements of depository institutions.

The interest rate that banks charge one another to lend or borrow excess reserves overnight is known as the federal funds rate. Banks are required by law to maintain a minimum reserve.

Read more on the federal reserve here:https://brainly.com/question/25817380

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