This short video describes the use of the interest rate on bank reserves as a tool of monetary policy.
Describing and analyzing monetary policy from FOMC press releases.
Basic mechanics of monetary and fiscal policy. Created by Sal Khan.
Monetary policy is the use of the money supply to affect key macroeconomic variables, such as real GDP. This video focuses on how a central bank can use open market operations and reserve requirements to enact monetary policy to close output gaps.
They say that "money makes the world go round." Just imagine a world without money as our method of payment for everyday transactions. Without money, we would all need to barter for necessary goods and services. For example, suppose an accountant needs to have her car fixed. Under a barter system, she would have to find someone who needed some tax advice in exchange for car repairs. The search to find a barter partner is time consuming and wasteful. Money solves this problem and many others. Read more about the three main functions of money and the damaging effects of too much inflation on these functions in the March 2013 issue.
The Federal Reserve conducts the nation’s monetary policy to promote maximum employment and price stability through the federal funds rate. The May 2019 issue of Page One Economics reviews the previous framework for monetary policy, and then describes the Federal Reserve’s new strategy for influencing the federal funds rate and the broader economy.
Principles of Macroeconomics 2e covers the scope and sequence of most introductory economics courses. The text includes many current examples, which are handled in a politically equitable way. The outcome is a balanced approach to the theory and application of economics concepts. The second edition has been thoroughly revised to increase clarity, update data and current event impacts, and incorporate the feedback from many reviewers and adopters.Changes made in Principles of Macroeconomics 2e are described in the preface and the transition guide to help instructors transition to the second edition.
By the end of this section, you will be able to:
Differentiate among a floating exchange rate, a soft peg, a hard peg, and a merged currency
Identify the tradeoffs that come with a floating exchange rate, a soft peg, a hard peg, and a merged currency
By the end of this section, you will be able to:
Identify U.S. budget deficit and surplus trends over the past five decades
Explain the differences between the U.S. federal budget, and state and local budgets
By the end of this section, you will be able to:
Explain the reason for open market operations
Evaluate reserve requirements and discount rates
Interpret and show bank activity through balance sheets
By the end of this section, you will be able to:
Explain the structure and organization of the U.S. Federal Reserve
Discuss how central banks impact monetary policy, promote financial stability, and provide banking services
By the end of this section, you will be able to:Describe microeconomicsDescribe macroeconomicsContrast monetary policy and fiscal policy
With this free video resource, students will explore the economic way of thinking, and the role incentives play in all our lives through engaging Hollywood production style videos.
Educators can use MRU's videos in a variety of ways, to include “flipping” the classroom, as study aids, supplementary material, concept reinforcement, or even as a full course offering.
In MRU's Principles of Macroeconomics course, we’ll cover fundamental questions such as: Why do some countries grow rich while others remain poor? How important is a country’s banking system — and what happened during the recent financial crisis? How did Zimbabwe end up with an inflation rate that rose into the quadrillions?
We’ll also cover important topics like the Federal Reserve, monetary policy, fiscal policy, the Solow Growth Model, institutional analysis, the “economics of ideas,” and more.
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What is Marginal Revolution University (MRU)?
Many of us can remember our first great economics teacher who fundamentally changed how we see the world. At MRU, we try and deliver that experience to millions worldwide through video.
Founded as a nonprofit in 2012 by George Mason University economics professors Tyler Cowen and Alex Tabarrok, MRU is building the world’s largest online library of free economics education videos -- currently weighing in at more than 800 videos.
