Question

Open-market operations are: A) Commerce Department efforts to open foreign markets to international trade. B) Federal Reserve purchases and sales of government bonds. C) Securities and Exchange Commission rules requiring open disclosure of market trades. D) Treasury Department purchases and sales of the U.S. gold stock.

Answer 1

Answer: Open-market operations are: "B) Federal Reserve purchases and sales of government bonds.

Explanation: Open market operations are all those transactions for the sale of financial assets carried out by a central bank. They constitute the most important instrument of monetary policy.