Monetary policy. The Federal Reserve uses monetary policy to regulate the nation's money supply. Monetary policy is directed at expanding or contracting the supply of money and credit in the U.S. economy. In theory, if there is too little money in circulation, consumers will spend less, interest rates will be high, and unemployment will rise. In this situation, the Fed can deliberately increase the amount of money in circulation, leading to lower interest rates, increases in consumer spending, and higher employment rates. If there is too much money in circulation, however, prices rise and the value of the dollar decreases (inflation). $.01, $.05, $.10, $.25, $.50, and $1.00. The denominations of coins in the United States are $.01 (penny), $.05 (nickel), $.10 (dime), $.25 (quarter), $.50 (half-dollar) and $1.00 (dollar). Higher denominations of legal tender are in paper currency. At times, the US Mint does issue special coins of additional denominations. An ATM transaction. According to the Electronic Funds Transfer Act, Electronic funds transfers (EFTs) are any transfers of funds, other than a transaction originated by check, draft, or other paper instrument, initiated through electronic terminal, telephone, or computer, to authorize a financial institution to debit or credit an account. EFT's can be used to carry out many financial transactions, for example, to pay utility bills, make installment loan payments, and transfer funds from a savings account to a checking account or vice versa.