An Open Market Operation Is the Federal Reserve's Purchase or Sale

question 39

Multiple Choice

An open market operation is the federal Reserve's purchase or sale of

• A) corporate bonds.
• B) Treasury reserves.
• C) excess reserves.
• D) Treasury securities.

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Definitions:

Tax Revenue

Tax revenue represents the income that a government receives from taxing individuals and businesses within its jurisdiction.

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the equilibrium price, where supply equals demand in a market.

Price

Price is the amount of money expected, required, or given in payment for something.

Tax

A compulsory financial charge imposed by a government on individuals or entities to fund government spending and public expenditures.