Question
Explain the textbook model for how in the U.S. the Federal Reserve (Fed) uses monetary policy to manage aggregate demand (AD) in the economy. In
Explain the textbook model for how in the U.S. the Federal Reserve (Fed) uses monetary policy to manage aggregate demand (AD) in the economy. In your response you must discuss (name and describe) at least three tools the model says the Fed uses, and explain how the model says each of those tools, though directional change, affect the money supply, interest rates, and AD (done through example). Hint: Review Table 16.3
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