Discuss the goals of expansionary and contractionary monetary policies used by the Federal Reserve Bank and the approaches (called monetary policy tools) used to achieve each policy. Also, discuss the effect of each policy on GDP, price level, private investment (investment in capital acquisition by firms and housing by households), and net trade?

Answer rating: 100% (QA)

Expansionary Monetary Policy Goals 1 Stimulate Economic Growth The primary goal is to boost economic activity especially during periods of recession o... View the full answer