Description
Assume that the U.S. economy just entered into a recession. What can the Federal Reserve do to try to get the economy out of a recession? Among other comments that you may make, please be sure to discuss the following:
Describe the role of the Federal Open Market Committee of the Federal Reserve in the United States, and describe the tools available to the Federal Reserve to influence the nation’s money supply.
Discuss the Federal Reserve’s open-market operations, and the importance of its role. How does another key central bank around the world conduct such operations, and why are they important? What recent open-market operations have the Federal Reserve and another country's central bank taken?
Explain what happens to the U.S. money supply when the Federal Reserve buys and sells Treasury bonds. Describe in detail how this has affected U.S. banks’ abilities to lend and the overall U.S. economy.
Explain what has happened to the U.S. money supply and economy when another central bank outside the United States has bought and sold U.S. Treasury bonds.
How do you think that you will be personally impacted by the recession?
Include at least 4 professional references and follow APA formatting. 700 words
Explanation & Answer
Attached.
Running head: IMPORTANCE OF THE FEDERAL RESERVE IN THE ECONOMY
Importance of the Federal Reserve in the Economy
Student’s Name
Institution’s Name
Lecture’s Name
Date of Submission
1
Running head: IMPORTANCE OF THE FEDERAL RESERVE IN THE ECONOMY
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Importance of the Federal Reserve in the Economy
The US Federal Market Committee has roles that it plays in ensuring that the economy gains
after entering into recession phase. The committee assesses the state of economic activities and
accurately forecasts the future path of events in the marketplace (Chang and Hanson, 2016). This
assessment is essential in making decisions regarding monetary policies. The Central bank
invests resources in predicting economic activities in the economy to guide in making policy
decisions. Before the Federal Open Market Committee holds meetings, the Federal Reserve
board prepares a detailed projection of the US economic activity for the Federal Open Market
Committee (Chang and Hanson, 2016). This accurate projection is referred to as the”
Greenbook.” In the preparation of the “Greenbook,” economists, research assistants, and legal
administrative staff come together to prepare it.
In analyzing the ac...
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