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Question: What are the three main tools the Federal Reserve (Fed) has at its disposal to carry out monetary...

Show transcribed image text What are the three main tools the Federal Reserve (Fed) has at its disposal to carry out monetary Setting the discount rate, increasing taxes, and building highways Conducting open market operations, increasing spending by the federal government, and decreasing taxes Paying interest on reserves, conducting open market operations, and controlling money demand Conducting open market operations, setting the discount rate, and paying interest on reserves During the financial crisis of 2007-2008 the Fed engaged in lending to certain large non-bank financial firms in the private sector. Which of the following describes the reasoning behind the Fed's decision to engage in this type of nontraditional lending? The Fed wanted to make a higher than normal return on their investment. The Fed wanted to limit the inflation risk inherent among financial institutions. The Fed wanted to limit the interest rate risk inherent among financial institutions. The Fed wanted to limit the systemic risk inherent among financial institutions.

What are the three main tools the Federal Reserve (Fed) has at its disposal to carry out monetary Setting the discount rate, increasing taxes, and building highways Conducting open market operations, increasing spending by the federal government, and decreasing taxes Paying interest on reserves, conducting open market operations, and controlling money demand Conducting open market operations, setting the discount rate, and paying interest on reserves During the financial crisis of 2007-2008 the Fed engaged in lending to certain large non-bank financial firms in the private sector. Which of the following describes the reasoning behind the Fed's decision to engage in this type of nontraditional lending? The Fed wanted to make a higher than normal return on their investment. The Fed wanted to limit the inflation risk inherent among financial institutions. The Fed wanted to limit the interest rate risk inherent among financial institutions. The Fed wanted to limit the systemic risk inherent among financial institutions.