The primary objective of Fed open market activity is to alter the price of bonds and their yields.
By influencing bond prices and yields,the Fed is essentially playing a role in setting interest rates for the overall economy because many rates are based on bond interest rates.

Question

Quizplus · Accepted Answer

By influencing bond prices and yields, the Fed is indirectly setting interest rates for the overall economy as many rates are based on the bond interest rates. Therefore, the primary objective of Fed open market activity is to alter the price of bonds and their yields.

The Primary Objective of Fed Open Market Activity Is to Alter