Question
In: Economics
Describe the Board of Governors of the Fed and the Open Market Committee (FOMC).
Describe the
Board of Governors of the Fed and the Open Market Committee
(FOMC).
Solutions
Expert Solution
1) Board of Governors of the Federal Reserve is the main governing body that is responsible for the working of the Federal Reserve banks in the United States of America and implementing the monetary policies in the country. There are a total of 7 members on the board that run the Federal Reserve in the States. Each member has a 14 year term as a board member.
The Board functions independently and is not answerable to the government in power. One of its main functions is to prepare an annual report of the operations of the Federal Reserve.
2) Federal Open Market Committee is a branch of the Federal Reserve that deals with the nation's open market operations. It was formed in 1933 through The Banking Act. It is responsible for setting up the monetary policies for the nation by specifying objectives for the country's open market operations. The committee is responsible for setting the interest rate and deciding the money supply in the economy
The Committee consists of the seven members of the Board of Governors of the Fed, the president of the New York Fed, and four of the other eleven regional Federal Reserve Bank presidents, serving one year terms.
Rahul Sunny answered 2 years agoRelated Solutions
Go to www.federalreserve.gov/FOMC/default.htm, the official Wed site of the Federal Open Market Committee (FOMC) of the...
Go to www.federalreserve.gov/FOMC/default.htm, the official Wed
site of the Federal Open Market Committee (FOMC) of the Federal
Reserve Board. Scroll down the page and choose the link to one of
the most recent statements from FOMC meetings. In your initial
response to the topic you have to answer all questions: Define the
Federal Funds Rate. What is the current Federal Funds Rate? Define
the Federal Reserve Discount Rate. What is the current Federal
Reserve Discount Rate? What are the factors...
Go to www.federalreserve.gov/FOMC/default.htm, the official Wed site of the Federal Open Market Committee (FOMC) of the...
Go to www.federalreserve.gov/FOMC/default.htm, the official Wed
site of the Federal Open Market Committee (FOMC) of the Federal
Reserve Board. Scroll down the page and choose the link to one of
the most recent statements from FOMC meetings.
In your initial response to the topic you have to answer
all questions:
Define the Federal Funds Rate. What is the current Federal Funds
Rate?
Define the Federal Reserve Discount Rate. What is the current
Federal Reserve Discount Rate?
What are the factors...
Select the correct answer: The Fed’s main policy-making committee is the (Board of Governors; Federal Open...
Select the correct answer:
The Fed’s main
policy-making committee is the (Board of Governors; Federal
Open Market Committee).
The Fed sets the
minimum percentage of deposits that must be held as reserves, which
is called the (discount rate; required reserve
ratio).
The currency in a
bank’s vault is part of the bank’s (reserves;
loans).
The purchase or sale
of government securities by the Federal Reserve is an (unit
of account; open market operation).
Along the aggregate
(supply curve, demand curve)...
Assume that you are attending a meeting of the Federal Reserve’s Open Market Committee (FOMC). There...
Assume that you are attending a meeting of the Federal Reserve’s
Open Market Committee (FOMC). There is great concern among the
members that the U.S. economy is in a recessionary trend, while
others believe that the U.S. economy is booming. Based on your
reading, write a brief report to summarize your suggestions on how
to adjust the current monetary policies. In your discussion, please
specify the available tools that the Fed could use and how these
policy changes affect your...
U.S. monetary policy is set by the Federal Open Market Committee (FOMC). The purpose of the...
U.S. monetary policy is set by the Federal Open Market Committee
(FOMC). The purpose of the policy is to encourage maximum
employment, stable prices, and reasonable long-term interest
rates.
Questions:
Discuss the tools the Federal Reserve uses to control monetary
policies. Include the objective each tool is used to deliver.
Expand on how the Federal Reserve System uses the interest rate to
affect the money supply.
In a recent meeting (January 16, 2020) of the Federal Open Market Committee (FOMC), the Federal...
In a recent meeting (January 16, 2020) of the Federal Open
Market Committee (FOMC), the Federal Reserve eliminated the reserve
requirement on deposits and other reserve items at banks and other
depository institutions up to $16.9 million and reduced the reserve
ratio to 3% on amounts $16.9 to $127.5 million.
What is likely to happen to interest rates in the economy as a
consequence? Use the loanable funds theory of interest rate to
justify answer.
After every meeting, the Federal Open Market Committee (FOMC) releases a statement that summarizes their policy...
After every meeting, the Federal Open Market Committee (FOMC)
releases a statement that summarizes their policy decisions.
"Information received since the Federal Open Market Committee
met in October suggests that economic activity has been expanding
at a moderate pace. Household spending and business fixed
investment have been increasing at solid rates in recent months,
and the housing sector has improved further; however, net exports
have been soft. Overall, taking into account domestic and
international developments, the Committee sees the risks...
1. What is the FOMC (Federal Open Market Committee)? What tools does it have available to...
1. What is the FOMC (Federal Open Market Committee)? What tools
does it have available to alter the monetary base (MB)? Explain the
workings of each tool.
2. How is the monetary base (MB) connected to the money supply
(MS)? Be explicit on the connection.
Federal Open Market Committee (FOMC): “Press Release” December 13, 2017 “Information received since the Federal Open...
Federal Open Market Committee (FOMC): “Press Release” December
13, 2017 “Information received since the Federal Open Market
Committee met in November indicates that the labor market has
continued to strengthen and that economic activity has been rising
at a solid rate… [J]ob gains have been solid, and the unemployment
rate declined further. Household spending has been expanding at a
moderate rate, and growth in business fixed investment has picked
up in recent quarters. On a 12-month basis, both overall inflation...
1 A)Assume the required reserve ratio is 20% and the Open Market Committee of the FED...
1 A)Assume the required reserve ratio is 20% and the Open Market
Committee of the FED buys $300 billion in bonds from the public.
Assuming banks give out as many loans as possible, what is the
total change in the money supply? What is the total change in
Transaction Accounts? If the M1 was original $8500 billion, what is
the new M1 ( After the change)? You must show your work.
B)Assume the required reserve ratio is 10% and the...
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