type all question follow by the answer....... - "Monetary Control" Please respond to the...

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type all question follow by the answer....... - "Monetary Control" Please respond to the following:Create an analogy or metaphor that explains how banks create and destroy money – one that would be understood by someone with absolutely no backgroun
	
Document Preview: "Monetary Control" Please respond to the following:Create an analogy or metaphor that explains how banks create and destroy money – one that would be understood by someone with absolutely no background in economics.Discuss how the U.S. Treasury’s decisions influence the Fed’s daily open-market operations."Policy Improvements" Please respond to the following:Discuss ways the Fed’s objective function can be used with an economic model to evaluate alternative monetary policies. Provide specific examples to support your response.Discuss ways that economists could use the Phillip’s curve to create better economic policy than we currently have. Explain your rationale.Working Capital Please respond to the following:Analyze the ways in which businesses manage working capital. Determine the single greatest challenge to small businesses and how those challenges may be addressed.  Provide specific examples to support your response.Discuss how likely technological advances over the next 20 years will change the way businesses manage working capital. Provide specific examples to support your response.Short-Term Financing Please respond to the following:Describe a small business you could see yourself owning and the strategy you would follow for financing working capital. Explain why your strategy would make sense for your business and location.Discuss the trade-offs between holding cash and investing in money market instruments. Then, identify which you lean toward and state why.

David · Accepted Answer

· Create an analogy or metaphor that explains how banks create and destroy money – one that would be understood by someone with absolutely no background in economics.
Banks all over the world are known as creators and destroyer of money. The central or the chief bank of any country has gold as storage and the regulation of the country allows the company to issue currency which is allowed up to a certain limit. This is what is termed as creation of money, while on the other hand when banks stop issuing fresh currency and issue fresh treasury papers in the economy, it is destroying currency or you can say taking a debt. 
· Discuss how the U.S. Treasury’s decisions influence the Fed’s daily open-market operations.
Treasury’s decision to freshly buy or sell new treasury instruments is keen and important for open market operations. An announcement by treasury that they will be issuing new treasury bonds on a particular day, issues FED a warning signal that they need to prepare for open market operations.
· Discuss ways the Fed’s objective function can be used with an economic model to evaluate alternative monetary policies. Provide specific examples to support your response.
If the objective function of the FED is to increase money supply in the market they can take either fiscal measures or monetary measures. Either of them will have a direct impact on the money supply. Hence we can say it is the objective function which will make sure that we are in position to increase or decrease money supply.

type all question follow by the answer....... - "Monetary Control" Please respond to the following:Create an analogy or metaphor that explains how banks create and destroy money – one that would be...

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