contestada

If the Federal Open Market Committee decides to increase the money supply, then the Federal Reserve:

a. sells government bonds from its portfolio to the public.

b. sells various types of stocks and bonds from its portfolio to the public.

c. creates dollars and uses them to purchase government bonds from the public.

d. creates dollars and uses them to purchase various types of stocks and bonds from the public.

Respuesta :

If the Federal Open Market Committee decides to increase creates dollars and uses them to purchase government bonds from the public. (option C)

How can money supply be increased?

The various steps taken by the Federal Open Market Committee to affect money supply is known as monetary policy. Monetary policy can either be expansionary or contractionary.

Expansionary monetary policy when the money supply is increased. Money supply can either be increased by carrying out an open market purchase or reducing interest rate.

An open market purchase is when the Federal Open Market Committee purchases government bonds from the public.

Contractionary monetary policy are policies taken to reduce the money supply. Money supply can be decreased by carrying out an open market sales or increasing interest rate.

To learn more about monetary policy, please check: brainly.com/question/3817564

#SPJ1

Otras preguntas