ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Easy money is when the Fed allows cash to build up within the banking system-as this lowers interest rates and makes it easier for banks and lenders to loan money. Easy money is a representation of how the Fed can stimulate the economy using monetary policy.

Detailed explanation-2: -Easy money policy, or expansionary monetary policy, is a central bank policy that lowers short-term interest rates. As a result, it makes money less expensive to borrow to boost economic development. Every country’s Central Bank is in charge of regulating the country’s money supply.

Detailed explanation-3: -"Easy” or expansionary monetary policy occurs when the Fed tries to increase money supply by expanding excess reserves in order to stimulate the economy. 3.

Detailed explanation-4: -Quantitative Easing, or QE, is another form of expansionary monetary policy. For example, when the benchmark federal funds rate is lowered, the cost of borrowing from the central bank decreases, giving banks greater access to cash that can be lent in the market.