I’m working on a business discussion question and need an explanation and answer to help me learn.
Discussion 1.)
-Prompt: In what way does the Federal Reserve have a high degree of instrument
independence? If it has a specific mandate from Congress to achieve “maximum
employment and low, stable prices,” then how does the Fed have goal
independence?
Discussion 2.)
– Prompt: What effect might a financial panic have on the money multiplier and the
money supply? Why
Discussion 3.)
-Prompt: What are the disadvantages of using loans to financial institutions to prevent bank panics?
Discussion 4.)
-Prompt: Why is the composition of the Fed’s balance sheet a potentially important
aspect of monetary policy during an economic crisis?
