The Fed is an active participant in money markets mainly because of its responsibility to

Question

Quizplus · Accepted Answer

The Fed's main responsibility is to control the money supply in the economy, and participating in money markets is one way of implementing its monetary policy. By buying or selling securities in the market, the Fed can influence the amount of money available for lending and borrowing, and thus regulate interest rates and inflation. The other options (A, C, and D) are not direct or primary objectives of the Fed's monetary policy.

The Fed Is an Active Participant in Money Markets Mainly