The most used tool of the Fed is:
A) open market operations.
B) the reserve requirement.
C) the discount window.
D) These are all used with equal frequency.

Question

Quizplus · Accepted Answer

Open market operations are the most frequently used tool by the Fed. This involves the buying and selling of government securities in the open market, with the aim of influencing the supply of money and credit in the economy. The Fed uses open market operations to adjust interest rates and maintain price stability. The reserve requirement and discount window are also important tools, but they are not used as frequently as open market operations.

The Most Used Tool of the Fed Is