Topic 10: Monetary Policy
Key Points
- Define money and the money supply
- Understand bank reserves and the federal funds interest rates
- Understand how the Federal Reserve uses open market operations to change the federal funds interest rate
- Be able to describe the money multiplier process
- Analyze the short-run impact of monetary policy on the economy
- Be able to describe why the long-run impact of monetary policy is neutral
- Understand the distinction between expansionary and contractionary monetary policy
- Describe the costs of high inflation
Videos
Money
Measuring the Money Supply
Bank Reserves and Federal Funds Interest Rates
Open Market Operations
Money Multiplier - Part 1
Money Multiplier - Part 2
Monetary Policy Transmission Using AS & AD