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economic paper Read an article about monetary policy. Analyze what would have happened if the Fed hadn't acted as they did after the 9/11 terrorist attacks.

Date Posted: 17/11/2019
Category: Economics
Due Date: 19/11/2019
Instruction
Read the article "Monetary Policy and Interest Rates" from The Economics of Macro Issues, by Roger LeRoy Miller and Daniel K. Benjamin. 1. Briefly summarize the main points of the article in your own words 2. Answer question #3 from the end of the article: "One effect of the September 11, 2001 terrorist attacks was to temporarily prevent banks from accessing reserves they needed to meet the demands of their customers. (This occurred because the attacks destroyed many records as well as the computers required to access backup records, and it took affected banks several weeks to become fully operational.) In response, the Fed made many billions of dollars of reserves available to banks, gradually withdrawing the new reserves from the banking system as that system returned to normality. Suppose the Fed had not injected reserves in this way. What would likely have happened to interest rates as a result? What would have been the likely impact on the stock market and on spending by consumers and businesses? Would the unemployment rate have gone up or down?"
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