What is the short-term effect of the FOMC on credit availability?

The Federal Open Market Committee (FOMC) influences the availability of credit primarily through its monetary policy decisions, which often involve adjusting interest rates. When the FOMC lowers interest rates, it typically encourages borrowing and spending by making loans cheaper, thus making credit more available. Conversely, when the FOMC raises interest rates, borrowing becomes more expensive, leading to a decrease in credit availability.

The focus of this question is specifically on how the FOMC's actions directly impact credit availability, which is most accurately represented by the correct choice. The other options, while related to the broader goals of economic policy, do not directly address the FOMC's immediate effect on credit markets. Checking inflation and stopping a recession are more indirect outcomes of the committee’s broader policy measures, but they do not solely define immediate changes in credit availability. Thus, the correct response highlights the most direct consequence of FOMC actions, which is the adjustment in the availability of credit based on interest rate changes.