Which of the following is a potential monetary policy instrument for the Fed?
A) federal funds rate
B) loanable funds
C) inflation rate
D) real interest rate
E) profit rates

Question

Quizplus · Accepted Answer

The federal funds rate is a key monetary policy instrument that the Fed uses to influence the money supply and interest rates in the economy by setting the rate at which banks can lend and borrow overnight funds from each other. The other options listed are not direct monetary policy instruments that the Fed can control or manipulate.

Which of the Following Is a Potential Monetary Policy Instrument