Role of Federal Reserve

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Adam F


Date added:

September 18, 2013








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It would follow into a situation where businesses and consumers would also cut back on spending ("Freedom Investments," 2002). By increasing its reserve requirement Federal Reserve can also decrease funds that are available for borrowing which could force the economy to slow down. Conducting open market operations Fed can control currency flow...
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Conducting open market operations Fed can control currency flow. When it sells government bonds to other banks it decreases amount of currency that is in circulation. To speed up the economy Federal Reserve would decrease its discount rate and reserve requirement. It would also purchase government bonds so banks have more funds available for borrowing...
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