Discuss why you believe that the FOMC has made such a decision, and explain the consequences of such a decision on the economy.

Discuss why you believe that the FOMC has made such a decision, and explain the consequences of such a decision on the economy.

 

In your answer, discuss the Federal Reserve’s use of open-market operations to influence the money supply and the respective consequences of such actions. Include a discussion of the money multiplier effect in your response. Justify your conclusions and provide appropriate examples.