The Fed is under no obligation to coordinate its actions with any fiscal policy taken. In fact, the Fed may take actions specifically designed to counteract some piece of fiscal policy. An example of fiscal and monetary policies with opposite effects is:

A. an increase in taxes and increased sales of bonds by the Fed.

B. a decrease in government spending and an increase in the discount rate.

C. a decrease in taxes and a decrease in reserve requirements.

D. an increase in government spending and an increase in reserve requirements. E. an increase in taxes and an increase in the discount rate.

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