The buying and selling of bonds by the Federal Reserve to manage the money supply is called ________.

Question

Quizplus · Accepted Answer

Open market operations refer to the buying and selling of government securities (such as bonds) by the Federal Reserve in order to control the money supply and influence interest rates. Quantitative easing is a type of open market operation that involves the purchase of longer-term securities in large quantities in order to stimulate the economy. Discount window operations involve lending to banks in times of emergency, and money supply management and Federal Reserve operations are more general terms that could refer to a variety of actions taken by the Fed.

The Buying and Selling of Bonds by the Federal Reserve