Evaluate the 3 goals of the Fed, which are price stability, full employment and
ID: 1116453 • Letter: E
Question
Evaluate the 3 goals of the Fed, which are price stability, full employment and economic growth. Which one do you think is the most important goal for the Fed to focus on right now? Also, what would be appropriate monetary policy for the Fed to help stabilize the economy? Evaluate the 3 goals of the Fed, which are price stability, full employment and economic growth. Which one do you think is the most important goal for the Fed to focus on right now? Also, what would be appropriate monetary policy for the Fed to help stabilize the economy? Evaluate the 3 goals of the Fed, which are price stability, full employment and economic growth. Which one do you think is the most important goal for the Fed to focus on right now? Also, what would be appropriate monetary policy for the Fed to help stabilize the economy?Explanation / Answer
The main objective of the Central Banks of the Country is following
The monetary policy of the Federal Reserve divided into two ways Expansionary increasing the money supply in the economy during deflation situation to encourages investment activities in the economy and Contractionary monetary policy involves reducing the supply of money in the economy during inflation and after full employment level.To achieving thse goal Federal Reserve uses tools like Bank rate, Reserve ratio, Open market operations.
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