Suppose that current output is initially above potential output. If the Fed wants to return output to potential it could
Posted: Wed Jul 06, 2022 5:59 am
Suppose that current output is initially abovepotential output. If the Fed wants to return output to potential itcould:
Lower the reserve requirement
Buy U.S. Treasury bonds
Raise interest rates paid on excess reserves
Lower the discount rate
Lower the reserve requirement
Buy U.S. Treasury bonds
Raise interest rates paid on excess reserves
Lower the discount rate