Reference no: EM131482567

Go to https://sffed-education.org/chairthefed/default.html to play the Fed Game.

Your Job

The President of the United States has nominated you and the U.S. Senate has confirmed you to serve as the Chair of the Federal Reserve. Your job is to set monetary policy to achieve full employment and low price inflation. Your term will last 4 years (16 quarters).

Set Monetary Policy:Fed funds rate 

Adjust this key short-term interest rate to keep the economy on track.

Watch:Unemployment 

Keep unemployment close to its natural rate of 5%.

Inflation 

Keep inflation near the Fed's 2% inflation target.

Instructions:

Play the Fed Game at least three times. Submit a screen shot of your most successful results, and answer the questions below.

1. The primary way the Fed conducts monetary policy is:

2. Why does the Fed watch both inflation and unemployment?

3. Is the Fed's goal to reach an unemployment rate of zero?

4. Is the Fed's goal to reach zero inflation?

5. How do changes in the Fed funds rate affect the economy? How do changes in the Fed Funds rate affect inflation?

6. Does the Fed Chair set monetary policy?

7. Why isn't the money supply in the game?

8. What is the discount rate? Why is the discount rate not included in the game?