Which of the following tools of monetary policy is considered the most important on a day-to-day basis?

Question

Quizplus · Accepted Answer

Open-market operations are considered the most important tool of monetary policy on a day-to-day basis because it involves the buying and selling of government securities on the open market, which has a direct impact on the money supply and interest rates. The discount rate and reserve ratio are also important tools, but they tend to be used less frequently and have a more indirect impact on the economy. Paying interest on reserves is a relatively new tool that has been used by central banks, but its impact on the economy is still being studied.

Which of the Following Tools of Monetary Policy Is Considered