Monetary Policy
Now let’s ask the question, who are the main entities that can help out the economy? The US has the Federal Reserve, and the goal of the Federal Reserve is to try to keep the economy growing as long as possible.
The Federal Reserve implements monetary policy to improve the economy. This is done by affecting the money supply. The Federal Reserve has three methods of monetary policy:
1. Changing the discount rates.
2. Changing the required reserve ratio.
3. Buying/Selling government securities.