Question
2.(12 points) After the 2008 financial crisis, the Federal Reserve conducted several rounds of Quantitative Easing(QE). 2.a (4 points) Briefly discuss how Quantitative Easing (QE)
2.(12 points) After the 2008 financial crisis, the Federal Reserve conducted several rounds of Quantitative Easing(QE).
2.a (4 points) Briefly discuss how Quantitative Easing (QE) as a policy tool was different from the open market operations (OMO) that had been traditionally used by the Fed.
2.b (4 points) Use the money multiplier framework to explain why Quantitative Easing (QE) had relatively little effect on M1.
2.c (4 points) Briefly discuss why the banking sector has been willing to hold the high level of excess reserves (ER) even though it has been ten years since the 2008 financial crisis.
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