To correct excessive inflation, the Fed could use open market operations by buying Treasury securities in the secondary market. a. True b. False

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Social Studies

Donovan

27 March, 06:13

To correct excessive inflation, the Fed could use open market operations by buying Treasury securities in the secondary market. a. True b. False

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Angie Landry · Answer 1

To correct excessive inflation, the Fed could use open market operations by buying Treasury securities in the secondary market is False.

b. False

Explanation:

The another significant device accessible to the Fed is open market tasks (OMO), which includes the Fed purchasing or selling Treasury securities in the open market. This training is much the same as legitimately controlling financing costs in that OMO can increment or reduction the all out stockpile of cash and furthermore influence loan fees. It buys Treasury protections to expand the stock of cash and offers them to lessen the inventory of cash. By utilizing this arrangement of open market buying, the Federal Reserve can deliver the objective government supports rate it has set. It calls this procedure its open market tasks.