Content Standard 20: Fiscal and Monetary Policy

Grade 12 Benchmarks

7. Monetary policies are decisions by the Federal Reserve System that lead to changes in the supply of money, short term interest rates, and the availability of credit. Changes in the growth rate of the money supply can influence overall levels of spending employment and prices in the economy by inducing changes in the levels of personal and business investment spending.

10. The Federal Reserve tends to increase interest rate targets when it feels the economy is growing too rapidly and/or the inflation rate is accelerating. It tends to lower rate targets when it wants to stimulate the short-term growth of the economy.

• Monetary Policy Online Module
• The Fed’s New Monetary Policy Tools Online Module
• In Plain English: Making Sense of the Federal Reserve Online Module
• In Plain English: Making Sense of the Federal Reserve Video
• Classroom Economist: Monetary Policy lesson with interactive whiteboard and PowerPoint applications
• The Fed Explains Video Series—The Central Bank
• Fed Explains Video Series—Monetary Policy
• Feducation Video Series —Monetary Policy and Unemployment