The Fed sells short-term debt and uses the proceeds to buy long-term debt. This represents:
A)precommitment policies.
B)standard monetary policy.
C)quantitative easing.
D)operation twist.

Question

Quizplus · Accepted Answer

This is known as Operation Twist, a monetary policy strategy used by the Federal Reserve to flatten the yield curve by selling short-term securities and buying long-term securities.

The Fed Sells Short-Term Debt and Uses the Proceeds to Buy