Feb 6 HMWK

Feb 6 HMWK - FINA 3330 HMWK Sarah DeVito February 6, 2008...

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FINA 3330 HMWK Sarah DeVito February 6, 2008 A) The Federal Reserve searches to sustain a maximum level of employment while simultaneously maintaining stable prices, high economic productivity, stable foreign exchange markets, and sound financial systems. It is important to remember that many times, achieving all of these goals at the same short point in time is extremely difficult and goals must be prioritized. It seems that financial stability and economic growth have moved to the top of the Fed’s priority list in recent months with the mortgage crisis, suspected instability among many major banks, and the scare of looming recession. The Beige Book report from January 16, 2008 reports slowing of the increase in economic activity from the previous survey period to the current one. In other words, economic activity isn’t decreasing yet, but it is slowing at a fairly quick rate. The Fed reinforced its concerns about slowing economic activity in its January 30 press release when it announced a 50 basis point decrease in the fed funds rate and discount rate. On a broad level, a decrease in the fed funds and discount rates will
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Feb 6 HMWK - FINA 3330 HMWK Sarah DeVito February 6, 2008...

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