The Fed has more control over open market operations as compared to discount policy.

Question

Quizplus · Accepted Answer

Open market operations involve the buying and selling of government securities, which directly impacts the money supply and interest rates. The Fed has more control over this policy because they can very easily buy and sell securities through their trading desk. On the other hand, the discount policy involves lending to banks and setting the discount rate, which can have an indirect effect on the money supply and interest rates but may be influenced by other factors outside of the Fed's control.

The Fed Has More Control Over Open Market Operations as Compared