Explore BrainMass

Explore BrainMass

    Goals of monetary policy

    Not what you're looking for? Search our solutions OR ask your own Custom question.

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    What happens to the money supply, interest rates, and the economy in general if the Federal Reserve is a NET SELLER of government bonds?

    What happens to the money supply, interest rates, and the economy in general if the Federal Reserve is a NET BUYER of government bonds.

    © BrainMass Inc. brainmass.com March 4, 2021, 8:14 pm ad1c9bdddf
    https://brainmass.com/economics/employment/goals-monetary-policy-154597

    Solution Preview

    This is an issue of monetary policy. The Federal Reserve controls the three tools of monetary policy--open market operations, the discount rate, and reserve requirements. The term "monetary policy" refers to the actions undertaken by a central bank, such as the Federal Reserve, to influence the availability and cost of money and credit to help promote national economic goals.

    Goals of monetary policy are to promote maximum employment, inflation (stabilizing prices), and economic growth. If economists believe it's possible to achieve all the goals at once, the goals are ...

    Solution Summary

    Goals of monetary policy are posed. What happens to the money supply, interest rates, and the economy in general if the Federal Reserve is a NET SELLER of government bonds is determined.

    $2.49

    ADVERTISEMENT