Economic questions
1.Describe the organizational structure (different parts) of the Federal Reserve bank.
2.What is the equation of exchange? What are the variables, which are in it, and how do they relate to each other?
- Outline to the policy choices for contractionary and expansionary options of the Fed. 4.You have the assignment of making a recommendation to the Chairman of the Fed during a period of persistent, high inflation. What could you do to restore stable prices?
5.How will an expansionary monetary policy affect the GDP when the economy is at less than full employment? At full employment?
- how would the economy change with a new president ? what does it mean for economic growth, and job creation ?
Sample Answer
here are the different parts of the Federal Reserve System:
- The Board of Governors: The Board of Governors is the central governing body of the Federal Reserve System. It is located in Washington, D.C., and is responsible for setting monetary policy, supervising and regulating banks, and providing financial services to banks and other financial institutions.
- The Federal Open Market Committee (FOMC): The FOMC is the main policy-making body of the Federal Reserve System. It is responsible for setting monetary policy, which is the use of interest rates and other tools to control the supply of money and credit in the economy. The FOMC meets eight times a year to discuss monetary policy and make decisions about interest rates.