Question

What actions might the FED have taken to fix the economy?

Give your reasons.

Are conditions improving or not?

Why or why not?

Answer 1

Fed has been mandated to follow dual objective of price stability and full employment. Over the past few years, Fed has consistently used its power to stabilize and restore equilibrium in economy.

Fed has massively used its open market operation or quantitative easing to pull economy out of recession. it massively increased demand through purchase of securities.

Condition of economy has almost recovered and now economy is operating at full employment level. growth rate is also above 2 %. Thus, we can conclude economy has recovered.