If the Fed wants to increase the money supply,it will _____ Treasury securities.
A) sell
B) buy
C) hold
D) issue

Question

Quizplus · Accepted Answer

When the Fed wants to increase the money supply, it will buy Treasury securities. This injects cash into the system and makes more funds available for lending and spending. Selling Treasury securities would decrease the money supply. Holding them would not add or subtract from the money supply, and issuing them refers to the Treasury Department, not the Fed's actions in monetary policy.

If the Fed Wants to Increase the Money Supply,it Will