The Fed

The Federal Reserve, otherwise referred to as "The Fed," is the arm of the government charged with maintaining the health of the economy. In order to operate a business, it is essential to have a basic understanding of how the Federal Reserve functions and how it influences the economy. Here are some resources you can use to learn more about The Fed.

You can find a quick tutorial at Investopedia.

The Federal Reserve Band of St Louis has a video you can watch here:

For a more humorous look at The Fed, check this out...

For a more technical explanation of open market operations, watch this:

Assignment:

After reviewing the materials above, write a paper answering the following questions:

1. What is the goal of monetary policy?

2. What are the three primary "tools' the Federal Reserve uses to control monetary policy?

3. Under what conditions would the Fed raise interest rates? What key indicators would the Fed look at when making this decision?

Title your paper "The Federal Reserve." Format you paper in 12 point Times New Roman, double spaced text. Submit your paper by the end of class. Answer the questions thoroughly using compete sentences. Your paper will be graded on the following scale:

Grammar, usage and punctuation 0-3 points
Formatting 0-3 points
Completeness of your answers 0-4 points

Total points 10