The Federal Reserve regulates interest rates by altering the cost of borrowed money. This in turn affects the amount of capital flowing through the economy. When the Fed wants to stimulate economic growth, it lowers interest rates, making it cheaper for corporations to borrow money for investment purposes. Conversely, when inflation is rising too quickly, the Fed raises interest rates to discourage borrowing and slow inflation.
Economics can be intimidating to the person who is not well-versed in business and mathematics. This...
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