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Unformatted text preview: Open Market Operations o Contract money supply Sells bonds in Market o Expand Money Supply Buy Bonds in Market Discount Rate Changes Reserve Requirement Changes Earn Money: increase money supply, reduce interest rate, increase investment, increase GDP Keynesian Monetary Policy Linkage to GDP Expansionary Policy Increase Money Supply Excess Supply of Money Fall in Interest Rates Increase Investment (EX-IM) Increase GDP | K J = Y...
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This note was uploaded on 02/21/2008 for the course ECON 4.3 taught by Professor Fox during the Spring '99 term at Pennsylvania State University, University Park.
- Spring '99