The Buying and Selling of Bonds by the Fed to Change

question 94

Multiple Choice

The buying and selling of bonds by the Fed to change bank reserves is referred to as

• A)financial intermediation.
• B)reserve accounting.
• C)speculation.
• D)open market operations.
• E)asset and liability management.

---

Definitions:

Equity Multiplier

A financial ratio that measures the amount of a company’s assets financed by its shareholders' equity, indicating leverage.

Assets Support

Refers to the financial or operational support provided to maintain or enhance the value of a company's assets.

Dollar in Equity

Dollar in equity represents the value of an investor's ownership interest in a company, typically expressed in terms of the dollar amount of shares held.

Interval Measure

A financial metric used to determine a company’s ability to meet its short-term obligations without needing additional cash inflows.