Unit 3: Macroeconomic Policy

Lesson 16a: Monetary Policy

Tools of Monetary Policy

 

Open Market Operations (OMO)

Buy securities ER MS Rates I AD
Sell securities ER MS Rates I AD

Required Reserve Ratio (RR)

RR ER MS Interest Rates I AD
RR ER MS Interest Rates I AD

Discount Rate (DR)

DR ER MS Interest Rates I AD
DR ER MS Interest Rates I AD

 

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Lesson 16a