The tools or techniques that a central bank employs to achieve its monetary policy objectives are called
A) monetary policy instruments.
B) monetary policy targets.
C) settlement balances.
D) benchmark rates.
E) large value transfers.

Question

Quizplus · Accepted Answer

Monetary policy instruments refer to the tools or techniques used by a central bank to influence the money supply, interest rates, and credit availability in the economy in order to achieve its monetary policy objectives. Examples of monetary policy instruments include reserve requirements, open market operations, and discount rates.

The Tools or Techniques That a Central Bank Employs to Achieve