Problem: The Fed loosened monetary policy in various ways in 2007, but has recently started tightening monetary policy again. Explain how each instrument they have used works and whether it is a loosening or tightening policy. (1 sentence explanation):
1) Lower the target federal funds rate: monetary tightening or loosening?
2) Lower the cost of discount window lending: monetary tightening or loosening?
3) The Fed pays banks a positive interest rate on the reserves they hold at the Central Bank: monetary tightening or loosening?
4) Offer discount window access to a broader range of financial institutions: monetary tightening or loosening?
5) Implementing an open market purchase of bonds: monetary tightening or loosening?
6) Purchasing Mortgage-Backed Securities: monetary tightening or loosening?
7) Purchasing medium maturity Treasury Bonds (QE2): monetary tightening or loosening?