True or False:
1. If the Fed raises the discount rate, the money supply will tend to increase.
2. The discount rate is a relatively unimportant monetary policy tool, mainly because member banks do not rely heavily on the Fed for borrowed funds.
3. The discount rate's main significance is that changes in the rate signal the Fed's intentions with respect to monetary policy.
4. Currently, the Fed sets the discount rate below the federal funds target.
5. The Fed funds rate target tends to affect interest rates throughout the economy.
6. Setting the discount rate above the Fed funds target tends to discourage borrowing from the Fed's discount window.
7. If the Fed wanted to increase the money supply, it would buy bonds, lower reserve requirements, or lower the discount rate.
8. When interest rates are lower, the opportunity cost of holding monetary assets is higher.