The policy tool of "credit easing" refers to the
A)Fed's purchase of private securities to stimulate banks' lending.
B)Fed's requirement that the federal government must lend to directly to home buyers.
C)federal government's requirement that the Fed must lend directly to home buyers.
D)Fed's lowering of the federal funds rate to zero.
E)Treasury's issuance of federal debt to finance home buying.

Question

Quizplus · Accepted Answer

Credit easing refers to the Fed's purchase of private securities to stimulate banks' lending, which helps to increase credit availability to consumers and businesses. This policy tool was used during the 2008 financial crisis to prevent a collapse of the financial system and jumpstart economic growth.

The Policy Tool of "Credit Easing" Refers to the