Explore BrainMass

The Federal Reserve's monetary policy tools

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

Describe the monetary policy tools the Federal Reserve uses to stabilize the economy and maintain price stability.

© BrainMass Inc. brainmass.com December 20, 2018, 7:16 am ad1c9bdddf

Solution Preview

The Federal Reserve uses three main monetary policy tools. All are designed to change the money supply. If the money supply grows, GDP and inflation will increase. If the money supply shrinks, GDP and inflation will decrease.

1. Open ...

Solution Summary

This solution describes the three main monetary policy tools that the Federal Reserve uses to change the money supply.