Asked by Paula Izquierdo on Jun 12, 2024
Verified
Because of the multiple tools at its disposal, the Fed can control the money supply very precisely.
Money Supply
The total amount of money available in an economy at a specific time, including cash, deposits, and other liquid assets.
- Perceive the implements and tactics employed by the Federal Reserve to regulate the amount of money available and the operations of banking entities.
- Acquire knowledge about how variations in the money supply affect the economy.
Verified Answer
NL
Natalia LarinJun 16, 2024
Final Answer :
False
Explanation :
While the Federal Reserve has several tools to influence the money supply, such as open market operations, reserve requirements, and the discount rate, its control is not precise due to the complexity of the economy and the behavior of banks and consumers.
Learning Objectives
- Perceive the implements and tactics employed by the Federal Reserve to regulate the amount of money available and the operations of banking entities.
- Acquire knowledge about how variations in the money supply affect the economy.