Which tool would the Federal Reserve use as part of a contractionary monetary policy?
A. Buying treasury securities on the open market
B. Lowering the interest rate for bank reserves
C. Lowering the discount rate for short-term loans
D. Raising the reserve requirement on banks

The purchasing agent for a company that assembles and sells air-conditioning equipment in a latin american country noted that the cost of compressors has increased significantly each time they have been reordered. the company uses an eoq model to determine order size. what are the implications of this price escalation with respect to order size? what factors other than price must be taken into consideration?