When the Fed buys government bonds in the open market the money supply will increase.

Name: When the Fed buys government bonds in the open market the money supply will increase.
Brand: Quizplus
Rating: 4.8 (46 reviews)

Question

Quizplus · Accepted Answer

When the Fed buys government bonds in the open market, it injects new money into the economy, increasing the money supply. This is known as open market operations and is a tool used by the Fed to influence economic activity.

When the Fed Buys Government Bonds in the Open Market