Pros and cons of using monetary policy, Macroeconomics

Assignment Help:

The monetary system in any economy facilitates trade and allows people to trade more efficiently, as compared to a barter economy. In the United States, the monetary authority is the Federal Reserve System (also referred to as the Federal Reserve, or informally, as the "Fed".)

For this assignment, use the information presented in the textbook and the Fed's website when addressing the questions below.

1. What are the requirements for something to be considered money? Why does the dollar have value?

2. What does the money supply consist of and what are the respective amounts in the total money supply for the United States?

3. What are the primary functions of the Fed? What role does the Federal Open Market Committee (FOMC) play in our economy?

4. What role do the financial institutions (commercial banks and other institutions) play in our financial system?

5. What is meant by the term "fractional-reserve banking" in our system? What are the implications for consumers?

6. What are the tools available to the FED for controlling the money supply? Which are used most often? Which are most effective?

7. How does the money multiplier help to determine the effects of monetary policy?

8. What are the pros and cons of using monetary policy, as opposed to the use of fiscal policy, for implementing economic policies and practices?


Related Discussions:- Pros and cons of using monetary policy

New equilibrium price also quantity, Take a look at the sugar market: US d...

Take a look at the sugar market: US demand: Q=60-2/3 P US domestic supply: Q=P Also, the US could import any quantity from world producers at (US$) 10/cents per lb a) In a sc

Growth of trade, Growth of Trade: As far as the growth of exports and ...

Growth of Trade: As far as the growth of exports and imports are concerned,  it is evident  from Table 17.2  that India has performed better than the world growth  rates  in

Money demand, What will happen to the shape of the money demand curve if th...

What will happen to the shape of the money demand curve if the checking accounts bear interest? will it still slope down if the interest of the checking account is fixed while the

Define price elasticity of demand, Suppose the price elasticity of demand f...

Suppose the price elasticity of demand for used cars is estimated to be 3 what does this mean?

Currency, Assume that Jimmy Cash has $2000 in his checking account and uses...

Assume that Jimmy Cash has $2000 in his checking account and uses his checking card to withdraw $200 from his ATM machine. By what amount did M1 change from this individual transac

Neo-classical synthesis, Neo-classical synthesis is a synthesis of classica...

Neo-classical synthesis is a synthesis of classical model and Keynesian model. In brief, it states that Keynesian model is correct in the short run whereas the classical analysis i

Financial Crises, #question. BANK Z (@ 10% RR) ASS...

#question. BANK Z (@ 10% RR) ASSETS LIABILITIES RR: K200,000 Deposits : K2,000,000 ER : K1,800,000 You are given the above Balance sheet for Bank Z as

Define the tools of competitive market, Define the tools of Competitive mar...

Define the tools of Competitive market. Competitive market: The supply and demand model a. The demand curve b. The supply curve c. Factors which cause the demand cu

Measurement of national income, what are the two precautions required while...

what are the two precautions required while estimating national income by value added method?

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd