FIN402 Financial institution and Market: Discussion 8
Week 8: Interactive activity
8.1 Learning Outcomes:
- Describe the structure of the Federal Reserve System and explain the reason for it.
- Explain the ways in which the Federal Reserve System is and is not independent from the rest of the government.
- Explain how the European System of Central Banks is both more and less independent than the Federal Reserve Systems.
- Describe and explain the trend toward more independent central banks.
- Describe the explanatory power of the theory of bureaucratic behavior when applied to central banks.
- Summarize the arguments for and against greater independence of the Federal Reserve System.
- Describe the three basic tools of monetary policy and how they are used by the Fed and the ECB.
- Identify the six goals of monetary policy
- Explain how a nominal anchor eliminates the time-inconsistency problem.
- Explain the advantages and disadvantages of inflation targeting.
- Describe the types of bubbles that can occur and how central banks should or should not respond to them.
- Explain why interest rate and aggregate policy instruments are incompatible.
- Explain how a central bank chooses an appropriate policy instrument.
- Explain the benefits of employing individuals who are experts in central bank behavior.
8.2 Action Required:
Watch the video in the following link:
8.3 Test your Knowledge (Question):
Discuss about that how monetary policy is helpful for Economy.
8.4 Instructions
- Post your answer in the discussion board using the discussion link below (Week8:Interactive learning Discussion)
