When the European System of Central Banks uses long-term refinancing operations,it is similar to the Federal Reserve using
A)dynamic open market operations.
B)defensive open market operations.
C)discount policy.
D)reserve requirements.

Question

Quizplus · Accepted Answer

Long-term refinancing operations by the European System of Central Banks is similar to dynamic open market operations by the Federal Reserve. Both involve providing liquidity to banks by offering long-term loans with the aim of influencing interest rates and promoting economic growth. Defensive open market operations involve selling securities to reduce reserves and increase interest rates, discount policy involves lending reserves at a discount rate, and reserve requirements involve setting minimum reserve levels that banks must hold. None of these are directly comparable to long-term refinancing operations.

When the European System of Central Banks Uses Long-Term Refinancing