The Federal Reserve System:
Background:The Federal Reserve System is overseen by the Board of Governors of the the Federal Reserve. The Board of Governors is headquartered in Washington, D.C. Its seven members are appointed for staggered fourteen -year terms by the President of the the United States with the advice and consent of the Senate. The President also appoints, from among these seven members, the chair of the Board of Governors. The Senate confirms the appointment. Chairs serve four-year terms. The chair acts as the main spokesperson for monetary policy for the country. Monetary policy refers to the actions the Fed takes to influence the level of real GDP.
The Fed Chairman Game (FCG) is an interactive online website tool to help you better understand the impact of the Federal Funds Rate on unemployment and inflation. Put yourselves in the chair’s shoes and try your hand at monetary policy through steering a simulated economy. Crises pop up throughout the game in order to lend an element of surprise and to simulate sudden changes in the economy. At the end of the game, the “Chair” is reappointed if you did well in keeping inflation low and stable and meeting the unemployment target.
Directions: Check out the Fed Chair Game and then answer the following questions and post your answers.
What is the relationship between interest rates and demand for money?
3.) What is one of the key roles of Chair of the Federal Reserve?
4.) How does the Chair of the Federal Reserve benefit American society?