asked 27.4k views
3 votes
what tool does the federal reserve use to influence the volume of money in the economy by buying and selling government securities

asked
User Doublemc
by
9.0k points

2 Answers

1 vote
It is "D. open-market operations" that is a tool the Federal Reserve uses to influence the volume of money in the economy by buying and selling government securities.
answered
User Max Usanin
by
7.8k points
3 votes

Answer:

Open market

Step-by-step explanation:

The open market is a monetary policy tool that the Federal Reserve uses to manipulate the amount of currency in circulation in the economy to stimulate or slow the economy. When the economy is in inflation, the Federal Reserve sells government securities, wiping the economy's monetary base. With less currency in circulation, inflation decreases. In contrast, when the Federal Reserve wants to stimulate the economy, it sells government securities by injecting money into the economy. Thus consumption increases and the economy improves.

answered
User Dileep Kheni
by
8.3k points

No related questions found

Welcome to Qamnty — a place to ask, share, and grow together. Join our community and get real answers from real people.