________ occurs when a central bank purchases assets with the intention not of lowering the short-term interest rate,which is already at zero,but with the purpose of increasing bank reserves.

Question

Quizplus · Accepted Answer

Quantitative easing is a monetary policy tool used by central banks to increase the money supply and stimulate the economy when interest rates are already very low. This is achieved by purchasing financial assets such as government bonds, corporate bonds, and mortgage-backed securities. The main aim is to increase bank reserves, which in turn encourages lending and investment, thus boosting economic activity.

________ Occurs When a Central Bank Purchases Assets with the Intention