Which of the following is (are) a tool(s) of monetary policy used by the Federal Reserve?
I. reserve requirements
II. the discount rate

Question

Quizplus · Accepted Answer

Reserve requirements and the discount rate are both tools of monetary policy used by the Federal Reserve. Reserve requirements refer to the percentage of deposits that banks are required to hold in reserve, while the discount rate is the interest rate at which commercial banks can borrow from the Federal Reserve. By adjusting these tools, the Federal Reserve can influence the amount of money in circulation and control inflation.

Which of the Following Is (Are) a Tool(s) of Monetary