ECO372 Week 3 Discussion Question 3

Question: #1596

What happens to the money supply, interest rates, and the economy if the Federal Reserve is a net seller of government bonds? What happens to the money supply, interest rates, and the economy if the Federal Reserve is a net buyer of government bonds. Why would the government implement a stimulus program into the economy?

Solution: #1581

ECO372 Week 3 Discussion Question 3

The Federal Reserve has a major tool that they can use to manipulate money supply, interest rates, and the economy it is called open market operati...