When the Fed uses quantitative easing, it is:
A) buying three-month Treasury bills.
B) selling three-month Treasury bills.
C) buying longer-term government debt.
D) selling longer-term government debt.

Question

Quizplus · Accepted Answer

When the Fed uses quantitative easing, it involves buying longer-term government debt, such as bonds, in an effort to increase the money supply and stimulate economic growth. This process puts more money into circulation and makes it easier for banks to lend and for consumers to spend, which can help boost economic activity.

When the Fed Uses Quantitative Easing, It Is