The federal reserves target rate for the federal funds rate

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Reference no: EM13773931

The Federal Reserve’s target rate for the federal funds rate

is an extra policy tool for the central bank, in addition to and independent of the money supply.

commits the Fed to set a particular money supply so that it hits the announced target.

is a goal that is rarely achieved because the Fed can determine only the money supply.

matters to banks that borrow and lend federal funds but does not influence aggregate demand.

Reference no: EM13773931

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