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Assignment 2: The Multiplier Effect




Question;Assignment 2: The Multiplier EffectGo to the Federal Reserve?s Web site at the words ?FOMC meeting 2009? in the search section of the site.Select the link for the article termed ?FRB: Press Release?FOMC statement?December 16, 2009.? You should now find a press release from the Board of Governors of the Federal Reserve System, dated December 16, 2009, which discusses the decisions of the Federal Open Market Committee (FOMC) for that date.Such release also states that the Federal Reserve is in the process of purchasing $1.25 trillion of agency mortgage-backed securities and about $175 billion of agency debt. Additionally, the release states that the FOMC has decided to gradually reduce ?the pace? of such Fed purchases. Discuss why you believe that the FOMC has made such a decision, and explain the consequences of such a decision on the economy.In your answer, discuss the Federal Reserve?s use of open-market operations to influence the money supply and the respective consequences of such actions. Include a discussion of the money multiplier effect in your response. Justify your conclusions and provide appropriate examples.By Tuesday, August 9, 2011, submit your responses to the M6: Assignment 2 Dropbox.Assignment 2 Grading Criteria MaximumPointsDiscussed in detail reasons for the FOMC decision to reduce the number of purchases of government securities.10Discussed the consequences of the FOMC?s decision on the economy.10Discussed the Federal Reserve?s use of open-market operations to influence the money supply.15Justified ideas and responses by using appropriate examples and references from texts, Web sites, and other references.10Wrote in a clear, concise, and organized manner, demonstrated ethical scholarship in accurate representation and attribution of sources, displayed accurate spelling, grammar, and punctuation.10Total: 55For assistance with any problems you may have when completing this assignment?OR?to offer your assistance to classmates, please use the Problems and Solutions Discussion area located through the left side navigation link.


Paper#57668 | Written in 18-Jul-2015

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