Question

Create an argument for which monetary policy (reserve requirements, Federal Funds rate, or interest rate) is the most significant in helping the Federal Reserve positively influence the economy. It must compare and contrast each one and explain why it is the most successful.

yes i refer to that

Answer 1

The Fed cannot control inflation or directly affect performance and employment. Instead, it affects them indirectly through the use of three monetary policy instruments:

Reserve requirement: This means that the bank should hold the shares as deposits or reserves. With the increase in available funds in the banking system and lending to consumers and companies, the shortage in reserves is accelerating. The increase in essential reserves is due to the availability of funds in the banking system for consumers and businesses.

Open Market Operations: Trading and Open Securities in the US is a reliable tool. As previously mentioned, the instrument was launched by FOMC and the Federal Reserve Bank of New York.

Interest Rate Reserve: A new and widely used instrument the federal Reserve after used the financial crisis in 2007–2009. Interest is paid out of the reserves held by the Reserve Bank. For the Fed, banks are required to keep a certain percentage of their deposits. In addition to these reserves, banks often have other reserves.

Under the current policy of paying interest on reserves, the Fed can use the interest rate as a means of monetary policy affecting the bank's debt. For example, if the Federal Open Market Committee wants to encourage banks to borrow more reserves, it may reduce interest rates on more reserves. The bank tried to give them loans instead of borrowing money as per the corruption policy. The Fed's monetary policy can be done by explaining how the target rate for federal funds can be established by manipulating the open market from late 2007 to late 2007.If the Federal Open Market Committee wants banks to have more surplus and create incentives to reduce debt, then the Federal Open Market Committee can increase the interest rate reserve, which is a contractual policy.

contractionary monetary policy further increased the amount of money and debt, lowered interest rates to respond to the overall demand and responded to the recession. Contract monetary policy, also known as monetary policy, reduces the amount of money and debt and raises interest rates to control inflation. During the 2008–2009 recession, central banks around the world used quantitative easing policies to increase the supply of debt.

The 1975 Fed measures against the United States economy did not include many key economic factors affecting unemployment, recession, economic growth, and inflation during that period. The Fed's nine measures, described in the following sections of the period, suggest that the central bank should be seen as one of the key actors with macroeconomic effects. As mentioned earlier, the Federal Reserve may have the greatest impact on the United States economy.

therefore these moetary tool everytime found to be effetive in the past episode and are still in effet to combat the problems of growth, inflation and unemployment.