| A | B |
|---|
| open market operations | buying and selling government securities by the Fed |
| reserve requirement | percentage of a bank's total deposits that must be held in reserve |
| monetary policy | policy that affects the money supply and thus credit and business activity in the economy |
| tight money policy | policy that discourages lending |
| loose money policy | policy that promotes lending |
| discount rate | rate of interest the Fed charges its member banks |
| the Fed | organization that regulates banking and implements monetary policy |
| government securities | investments sold by the government to finance growth |
