Question

Electronics Extravaganza is a large electronics company that sells its products internationally. The company has decided to buy a private airplane to facilitate its international business. Which function of the Federal Reserve Board would have the most impact on this company's ability to purchase an airplane?

Answer 1

Conduct the monetary policy of the country

Step-by-step explanation:

One of the main aspects of conducting the monetary policy of the country includes setting the FED's reference interest rates. The FED's interest rates affect every business and household of the country.

It is always easier to sell your products either locally or internationally when you can sell them using cheap credit (low interest rates). The EXIM bank (and other private banks) provides credit to foreign businesses that buy American exports. When the interest rate is low the price of American goods is more competitive in the international markets.

Maybe even Electronics Extravaganza needs to buy the plane on credit, and the lower the interest rate, the better.