Questions:
3-4 paragraphs
Provide a brief essay that addresses the following:
• Describe why Federal Reserve buys either their own currency or the currency of another nation in an effort to control exchange rates.
• What has the Federal Reserve done recently to stabilize the financial systems?
• What appears to be the major constraint that the Federal Reserve has used to determine the limits of the monetary injections into the economy?
• To what extent to do you agree or disagree with the actions of the Federal Reserve?
3-4 pages
Details:
Write a paper on U.S. monetary policy. In your paper, explain the three standard monetary policy tools of the Federal Reserve. Explain how each of those monetary policy tools affects the macroeconomy. Why are interest rates important? Please explain the Federal Reserve's current monetary policy and its objectives. How successful has it been?