Fin 100 Week 2 Discussion

Federal ReserveName:Institutional AffiliationFederal ReserveThe policy makers at the Federal Reserve uses the interest rates to control the inflation and unemployment rates. However, the other factors such as tax relief, oil price and At the beginning of the contract, the interest rate is at 4.5, inflation at 2.14 percent and unemployment at 4.75 percent. The inflation is slightly above the target inflation of 2 percent, while the unemployment is below the natural unemployment unemployment rate of 5 percent. My aim is to achieve more employment while keeping the inflation rates low. Maintaining the interest rate at the same high level in the first quarter results to a further decrease of unemployment as economic growth remains high due by 0.1 percent while the inflation rate increase by 0.1 percent. I would retain the interest rates at 4.5 for the third quarter would lead to a further reduction of unemployment, while leading to an increase in inflation.However, due to the general trend by industrialized countries to maintain a low interest rate, I reduce the rates to 4.0 percent in the third quarter and the inflation begin to reduce. I maintain the rates