To implement this action, is the Fed using a typical monetary policy tool?

economics

Description

In the past month, the Federal Reserve has taken several actions to stem the economic effects of the COVID-19 pandemic. For your assigned monetary policy action: https://www.federalreserve.gov/newsevents/pressreleases/monetary20200320b.htm

1.     Briefly describe the monetary policy action. Make sure to give numbers (percentage/basis points, millions/billions of dollars).

2.     To implement this action, is the Fed using a typical monetary policy tool?

3.     Could this action affect the monetary base? If so, how?

4.     Could this action affect the money supply? If so, how?

5.     Could this action affect the interest rates? If so, how?

6.     Is there any other aspect of the economy that this action could affect? Explain how.

 

You will be graded on:

·       Clarity/ Organization (5 points)

·       Content (10 points)

·       Demonstration of understanding of material (5 points)

·       Professionalism/Delivery (5 points)

 Please answer those questions based on the website. For each, write 2 analytical paragraphs. 

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