Question
Do you agree or disagree, why or why not. expand on response below. The Meaning behind monetary policy is the demand side of economic policy,
Do you agree or disagree, why or why not. expand on response below.
The Meaning behind monetary policy is the demand side of economic policy, it refers to the actions taken by a nation's central bank to control money supply and achieve macroeconomic goals and promote sustainable economic growth.
The three tools that the Federal Reserve has to conduct monetary policy are;
1. Reserve Requirements - A central banks regulation that sets the minimum amount of reserves that must be held by a commercial bank.A tool used by the central bank to increase or decrease money supply in the economy and influence interest rates.
2. The Discount Rate - The rate of interest which a central bank charges on its loans and advances to a commercial bank.
3. Open Market Operations - The purchase and sale of securities in the open market by a central bank.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started