Open-Market Operations Are Such a Powerful Tool of Monetary Policy

question 147

True/False

Open-market operations are such a powerful tool of monetary policy that they are seldom used.

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Definitions:

Drawee

The party in a financial transaction who is directed to pay a certain sum of money as per the payer's instructions.

Stop Payment Order

A request made to a financial institution to cancel the payment or processing of a check or payment transaction before it has been completed.

90 Days

A period of time consisting of exactly ninety days, often used in reference to deadlines or waiting periods.

Federal Reserve

The central banking system of the United States, responsible for monetary policy, regulating banks, and ensuring financial system stability.