Which of the following contributes to making the Federal Reserve an independent policy-making body?

(i) The Federal Reserve Act defining its role in the constitution

(ii) Federal Reserve Board of Governors with members appointed for staggered 14-year terms

(iii) Twelve regional Federal Reserve Banks

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Jamar FerryLv2

25 Jan 2019

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Unit 6. Monetary Policy: What works? Monetary policy by the US Federal Reserve is important for the US economy. However, economists disagree about several aspects of Federal Reserve decisionmaking powers including the composition of the Federal Reserve committees, Federal Reserve goals, and the actual impact of Federal Reserve policy on the economy. Address the following questions for this weekâs assignment: ? Provide a brief (one paragraph) overview of this weekâs material. ? Should the Federal Reserve Board focus exclusively on the problem of inflation? ? What other goals are appropriate for Federal Reserve policy? ? What is the appropriate goal for the inflation rate? ? How should the Federal Reserve Board use its policy to achieve its goals? ? How effective is the Federal Reserve monetary policy in achieving its goals? ? Is the composition of the decision-making bodies of the Federal Reserve appropriate for a democracy? For information from the Federal Reserve Board itself, go to the Board of Governors of the Federal Reserve System at: http://www.federalreserve.gov/ The Board of Governors site contains the Fed's Beige Book, Congressional testimony and speeches of Federal Reserve Board members, Federal Open Market Committee (FOMC) information, press releases, current interest rate information, and general information about the Federal Reserve System. A PDF-format version of The Federal Reserve System: Purposes and Functions, a thorough overview of the Federal Reserve System, is available by chapter or as a single document. In addition, the site contains a summary of Federal Reserve regulations. Particularly useful is the publication, âPurposes and Functions of the Federal Reserve Systemâ at: http://www.federalreserve.gov/pf/pf.htm And, âMonetary Policy: An Introductionâ http://www.frbsf.org/publications/federalreserve/monetary/index .html Criticism of the Federal Reserve Board comes from both conservatives and liberals sides. For a liberal viewpoint see the Financial Markets Center at: http://www.communityinvestmentnetwork.org/nc/single-news-itemstates/article/financial- markets-center/?tx_ttnews%5BbackPid%5D=326 For a conservative viewpoint, see the Shadow Open Market Committee at: http://shadowfed.org/ Your final product will be a paper that: ? Addresses each of the questions above in total. ? Is APA fortatted. ? The body is to be 2 pages minimum. The requirements for your assignment are: 1. Answer each question fully 2. Define the overall subject of each question. 3. Cite at least four (4) resources from this weekâs materials

pinkgerbil311

- An increase in government transfer payments of $250 billion and a tax cut of $250 billion will have _____ effects on the budget balance and _____ effects on real GDP.

A) equal; equal

B) equal; unequal

C) unequal; equal

D) unequal; unequal

- In the structure of the Federal Reserve, which of the following is part of the government?

I. the Board of Governors

II. the 12 regional Federal Reserve Banks

A) I only

B) II only

C) I and II

D) neither I nor II

- The Federal Reserve Bank of the United States is:

A)a purely private central bank.

B)a purely public central bank.

C)part of the U.S. government.

- If the Federal Reserve wants to increase the money supply, it could:

A)sell U.S. Treasury bills.

B)cut taxes across the board.

C)lower the reserve requirement.

D)increase the discount rate.

crimsonfrog361

The Federal Reserve System is responsible for establishing monetary policy. It has a significant degree of independence from the executive, legislative and judicial branches of government. Its policymakers, the seven-member Board of Governors, serve 14-year terms with one member appointed every two years. There are 12 Federal Reserve District Banks spread around the county rather than one central bank in Washington, D.C. to carry out the policies established by the Board of Governors.

Why do you think the Fed was set up in this manner? Do you think that it is a good system for establishing and carrying out monetary policy in the country? Some politicians have suggested that the executive and/or the legislative branches of government should have more say or influence regarding monetary policy. In your opinion, would this be a good idea or not?