In late 2008, the Federal Reserve began purchasing billions of dollars' worth of mortgage-backed securities from banks. This was evidence of:

Question

Quizplus · Accepted Answer

The Federal Reserve's purchasing of mortgage-backed securities is an example of quantitative easing, a monetary policy used to stimulate the economy by increasing the money supply and lowering interest rates. Fiscal policy refers to government spending and taxation, while forward guidance and interbank loans are different tools used by central banks for monetary policy.

In Late 2008, the Federal Reserve Began Purchasing Billions of Dollars