Question

Take a look at Figure 15-5. Suppose that the Federal Reserve's focus on monetary policymaking shifted away from buying and selling U.S.government securities to utilizing the discount rate or the interest rate paid on bank reserves as the Fed's main policy instrument. If so, would the Federal Open Market Committee necessarily remain the Fed's key policymaking group?

Short answer

Yes, the Federal Open Market Committee necessarily remain the Fed's key policymaking group

Step-by-step solution

introduction

U.S. financial approach centres around controlling the cash supply in the economy by controlling the loan fees through open market tasks.

explanation

The Federal Open Market Committee will keep on assuming a key part in controlling cash supply in the U.S. economy, regardless of whether the focal point of money related approach shifts from open market activities to limit rates. That is on the grounds that the Board of Governors and five Federal Bank presidents comprise the Federal Open Market Committee.