In this lesson, our instructor Jibin Park gives an introduction on the federal reserve and monetary policy. He discusses the history of the federal reserve, the federal reserve structure, functions of the federal reserve, reserve requirement and discount rate, open market operations, the financial crisis or 2008, and crisis and response.
The Federal Reserve was created in 1913 and is a private institution with a public component through its Board of Governors
The Federal Reserve includes 12 District Banks and through the Federal Open Market Committee (FOMC), the Fed controls monetary policy
The functions of the Fed include providing financial services, supervising and regulating banking institutions, maintaining the stability of the financial system and conducting monetary policy
The three conventional tools of the Fed in implementing monetary policy include changing the reserve requirement, discount rate and open-market operations
If the Fed raises the discount rate, increases the RRR or sells government securities, the money supply contracts
If the Fed lowers the discount rate, decreases the RRR or buys government securities, the money supply expands
Open-market operations (buying and selling of government bonds) is used to alter to target federal funds rate and is the preferred method of the Fed to control the money supply
The Federal Reserve & Monetary Policy
Lecture Slides are screen-captured images of important points in the lecture. Students can download and print out these lecture slide images to do practice problems as well as take notes while watching the lecture.
This book created a 5-step plan to help you study more effectively, use your preparation time wisely, and get your best score. This book includes two full-length practice exams modeled on the real test, all the terms and concepts you need to know to get your best score, and your choice of three customized study schedules.
This book includes an in-depth preparation for both AP economics exams. It features two full-length practice tests, one in Microeconomics and one in Macroeconomics, and all test questions answered and explained. It also features a detailed review of all test topics, which include: supply and demand, theory of consumer choice, economics in the public sector, costs, perfect and imperfect competition, monopolies, labor resources, game theory, the national income and gross domestic product, inflation and unemployment, fiscal policy, money and banking, monetary policy, economic growth, international trade and exchange, interest rate determination, and the market for loanable funds.