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3 tools that the Federal Reserve uses to pursue monetary policy are open-market operations, assignment help
The 3 tools that the Federal Reserve uses to pursue monetary policy are open-market operations, the discount rate, and the required reserve ratio (McEachern, 2015). Open-market operations are the purchase and sale of U.S. government bonds to increase the money supply. The discount rate is the interest rate that the Fed charged for bank loans. The required reserve ratio is the minimum amount of reserves that a bank must hold on deposits.
The tool that is used most often is open-market operations due to its simplicity, flexibility, and ease of use.
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