The purpose of quantitative easing is to drive down long-term interest rates, which are usually more important for private investment spending than short-term rates.

Question

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Quantitative easing involves buying long-term bonds in order to increase the demand for these bonds and reduce their yields or interest rates. This can make it cheaper for businesses and individuals to borrow money for long-term investment projects, which can stimulate spending and economic growth. Short-term interest rates are typically controlled by central banks through their monetary policy decisions, but long-term rates are more influenced by market forces and can therefore be more responsive to changes in quantitative easing policies.

The Purpose of Quantitative Easing Is to Drive Down Long-Term