L-Unit 2 Part 2 Exam:Fiscal &Monetary Which of the following is NOT a tool of monetary policy? Interest on Reserve Balances (IORB) Taxes ONRRP Discount Rate

## Step 1<br />Monetary policy is a tool used by central banks to control the money supply, often targeting an inflation rate or interest rate to ensure price stability and general trust in the currency. The tools of monetary policy include Interest on Reserve Balances (IORB), Overnight Reverse Repurchase Agreements (ONRRP), and the Discount Rate.<br /><br />## Step 2<br />Taxes, on the other hand, are not a tool of monetary policy. They are a tool of fiscal policy, which is the use of government spending and taxation to influence the economy.