Federal Reserve's Relationship to the Money Supply
1. Describe three ways in which the Federal Reserve can change the money supply.
2. If the Federal Reserve is going to adjust all of these tools during an economy that is growing too quickly, what changes would they make?
3. If the Federal Reserve is going to adjust all of these tools during an economic recession, what changes would they make?
4. What changes, if any, would you make to these tools at the next meeting of the Federal Reserve? Explain why and the benefits/drawbacks of this strategy.