Monetary Policy Tools
Monetary policy is the control of the quantity of money available in an economy and the channels by which new money is supplied. Why not print a lot of money so everyone could be rich? Simple answer, inflation. The supply of money is controlled so that there would be price stability. Steady economic growth with low inflation. At the macroeconomic level, the amount of money circulating in an economy affects things like gross domestic product, overall growth, interest rates, and unemployment rates . At the micro-level, a large supply of free and easy money means more spending by people and by businesses. Individuals have an easier time getting goods and services thus there comes a problem of high demand but very limited supply thus inflation and in some cases Hyper inflation making a country's currency drop in value and valueless in some cases Back to monetary policies, now you have some idea of what they aim to achieve. mainly price stability, steady economic growth and low