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The Economics of Money, Banking and Financial Markets 4th Edition by Frederic Mishkin
Edition 4ISBN: 978-0133859997The Economics of Money, Banking and Financial Markets 4th Edition by Frederic Mishkin
Edition 4ISBN: 978-0133859997 Exercise 1
Why do managers of financial institutions care so much about the activities of the Federal Reserve System?
Explanation
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The Federal Reserve System (Fed) is the U.S. central bank and accountable for generating monetary policies and controlling banking system.
The managers of financial institutions think about the activities of the Federal Reserve System because the functions of the Federal Reserve influence interest rates, inflation, and business cycles. These factors directly impact the profitability of financial institutions.
Managers of financial institutions along with the activities of the Federal Reserve also have to track the changes in political, social, economic and international environment. This helps them to effectively manage the institutions and ensure profitability.
The managers of financial institutions think about the activities of the Federal Reserve System because the functions of the Federal Reserve influence interest rates, inflation, and business cycles. These factors directly impact the profitability of financial institutions.
Managers of financial institutions along with the activities of the Federal Reserve also have to track the changes in political, social, economic and international environment. This helps them to effectively manage the institutions and ensure profitability.
The Economics of Money, Banking and Financial Markets 4th Edition by Frederic Mishkin
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