During a period of inflation, how would the Federal Reserve Board most likely respond?

During a period of inflation, the Federal Reserve Board typically aims to decrease the money supply and control inflationary pressures. Raising the reserve requirements for member banks is an effective method to achieve this goal. When the reserve requirements are increased, banks must hold a larger percentage of their deposits as reserves and are thus able to lend out less money. This reduction in lending activity leads to a contraction in the money supply, which can help to stabilize prices and curb inflation.

In contrast, the other options focus on measures that would typically be used to stimulate the economy rather than to control inflation. Lowering interest rates encourages borrowing and spending, which can exacerbate inflation rather than reduce it. Increasing the money supply generally promotes spending and economic activity, further fueling inflation. Purchasing government securities adds liquidity to the banking system, which also tends to stimulate economic activity rather than alleviate inflationary pressures.