pick one of the four tools the Fed uses to conduct monetary policy and discuss how it causes a change in interest rates in the US economy.

Q: What problems will the federal reserve face if people are unemployed and facing inflation?

A: Inflation is defined as the rise in the average price level of commodities and services in the…

Q: What is the basic focus of monetary policy? What are its drawbacks?

A: Monetary policy is the process through which a country's monetary authority controls the money…

Q: Do this photo below represent the best  concepts of the monetary policy? Why?

A: The economics is a study of market and the various agents which comprises of the economy including…

Q: Why does the Fed manipulate the money supply?

A: The Fed is the central bank of country. The Fed is foremost financial institution in the country. It…

Q: The Fed must know how much money people want to hold so that it can supply the appropriate amount?

A: The Federal Reserve System that is also known as the Fed is the United States' central bank and…

Q: What is the Federal Reserve System? Why was it created?

A: The Fed or Federal Reserve System is the central bank of the US which was established on 23rd…

Q: Which of the following is a traditional tool used by the Fed during recessions?

A: Fed use various tools to neutralize the effects of fluctuations like boom,recession etc,..

Q: does the Fed regulate money to influence the interest rates?

A: Federal Reserve is the central bank of United States. It is the apex bank and the regulator of…

Q: List the three tools that the Federal Reserve could use to enact Monetary Policy.

A: Federal Reserve: It is central bank of the United States

Q: Who was chair of the federal reserve system during the financial crisis of 2008?

A: A financial crisis is a situation when there is a significant decrease in the value of financial…

Q: Why does the Fed want to avoid an “overheating” economy?

A: Overheating of the economy is indicating the peak situation in the business cycle. Economy is doing…

Q: are immune from the effects of monetary policy. advise the Fed on monetary policy. O. vote on…

A: The member banks of the federal reserve system would result in the part of the body of the central…

Q: How changes in the tools of monetary policy affect the Federal Funds Rate? Do not draw the graphics,…

A: Monetary tools and Federal fund rate: Answer: Required reserve ration is a monetary policy tool it…

Q: Why might a central bank choose to monetize the debt,knowing that it could lead to higher inflation?

A: Debt monetizing refers to the sponsoring of government expenditures by the monetary authority of the…

Q: Let's pretend the economy is in a horrible recession, inflation is rising, and interest rates are…

A: A recession is a period in which the output level is below the potential level of output and the…

Q: Why does the Fed manipulate the money supply ? Why might a price "freeze" help monetary policy to…

A: The Fed is the main authority which manipulates the money supply in the economy because it initiates…

Q: are open market operations the most important tool that the Fed has to help stabilize the economy?

A: Monetary policy: Monetary policy is the tool in the hands of the central bank of a country which…

Q: WHAT ARE THE GOALS OF MONETARY POLICY?

A: The expression "monetary policy" tells the how much cash and credit in the U.S. economy by Federal…

Q: what kind of monetary policy can be used to fight against recession and depression

A: Recession is a temporary period of economic decline which leads to a fall in GDP for two successive…

Q: The monetary base is the sum of currency in circulation and bank reserves   True or False?…

A: The central bank of a nation controls the reserve ratio and interest rates which affect the lending…

Q: What are the goals of monetary policy? Which goal is the most important or the principal goal?

A: Monetary policy is a type of economic policy that regulates the amount and rate at which an…

Q: Why is it important for the members of the Board of Governors of the Federal Reserve to have longer…

A: The Federal Reserve in the U.S was created on 23rd December 1913. It is the central bank of the U.S.…

Q: As a governor of the Central Bank of Egypt, how could you use the THREE tools of monetary policy to…

A: Monetary policy refers to the tool which is used by central bank in order to increase or decrease…

Q: how does the monetary policy work?

A: Monetary policy refers to the rules and regulations implied by the central bank in the economy to…

Q: Why does the Fed manipulate the money supply ?

A: Answer: Introduction: Fed is the central bank of America. It is responsible for controlling…

Q: What’s the monetary policy? Why the Fed implements the monetary policy?

A: What’s the monetary policy? Answer: Monetary policy is a tool to improve the economic situation…

Q: What would be the consequences of eliminating monetary policy?

A: Monetary policy helps in adding money to the economy and that leads to lower interest rates. That…

Q: Describe some of the motives and mistakes made by the Fed?

A: Federal Reserve Bank is the Central bank of the Country U. It was established on 23rd December 1913.…

Required Reserve and Excess Reserve Analysis

A required reserve is an amount of cash that banks must keep with themselves, which is certain percentage of the deposits made by their customers. Required reserve is a percentage of the bank's deposits that the respective bank must have on each overnight. The percentage rate is set and determined by the nation’s central bank. It is important to have such funds accumulated to meet its uncertain obligations, sudden liabilities and withdrawals. Required reserve is also known as reserve ratio. Reserve ratio is an important tool to control the money supply.