1. The Federal Reserve uses monetary policy to influence inflation and unemployment.
2. Increasing interest rates typically stimulates borrowing and spending.
3. The Federal Funds Rate is the rate banks charge each other for overnight loans.
4. Contractionary monetary policy is used to combat high inflation.
5. Lowering the money supply tends to decrease interest rates.
6. Quantitative easing involves the central bank purchasing government bonds to increase money supply.
7. Expansionary monetary policy often reduces interest rates to encourage economic growth.
8. High interest rates make saving more attractive and borrowing more expensive.
9. The Federal Reserve's dual mandate is to achieve low inflation and high employment.
10. Raising interest rates decreases the value of fixed-income securities, like bonds.