1 / 8

Understanding Monetary Policy: Effects of Money Supply and Interest Rates

This article explores the short-term effects of changes in the money supply and the implications of the prime rate. It addresses the concept of debt monetization by the Federal Reserve and discusses the significance of the real rate of interest in economic decision-making. Additionally, it examines how timing and burden influence monetary policy effectiveness, as well as the consequences of low and high interest rates on future resource allocation. Finally, it provides insights into the components of different money supplies, namely M1 and M2.

zizi
Télécharger la présentation

Understanding Monetary Policy: Effects of Money Supply and Interest Rates

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. 1. What is the short-term effect of an increase or decrease in the money supply?

  2. 2. What is the prime rate?

  3. 3. What does it mean for the Fed to “monetize the debt”?

  4. 4. What is the real rate of interest and why is it used?

  5. 5. How do the issues of timing and burden impact the Fed’s monetary policy?

  6. 6. What effect do low interest rates have on future allocations?

  7. 7. What effect do high interest rates have on future allocations?

  8. 8. What do these money supplies consist of? • M1: b. M2:

More Related