ECONOMICS
FISCAL POLICY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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required reserve ratio
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buying & selling US Securities
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decreasing government spending
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discount rate
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Detailed explanation-1: -Which of the following is NOT one of the Fed’s monetary policy tools? The answer is c) changing the coupon rate. The discount rate, the required reserve ratio is determined by the Fed and the open market operation is also conducted by FED.
Detailed explanation-2: -About the FOMC The Federal Reserve Act of 1913 gave the Federal Reserve responsibility for setting monetary policy. The Federal Reserve controls the three tools of monetary policy–open market operations, the discount rate, and reserve requirements.
Detailed explanation-3: -Central banks have four main monetary policy tools: the reserve requirement, open market operations, the discount rate, and interest on reserves.
Detailed explanation-4: -The Monetary Policy Committee is not involved in setting the inflation target rate.