Quantitative Easing Refers To

question 211

Multiple Choice

Quantitative easing refers to:

• A)the selling of bonds to the private sector by a country's central bank in order to ease the money supply.
• B)the purchasing of private sector assets by a country's central bank in order to provide liquidity to the financial system.
• C)the selling of bonds by a country's central bank to the private sector in order to provide liquidity.
• D)the purchasing of private sector assets by a country's central bank in order to tighten liquidity.

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Definitions:

Product Differentiation

The process of distinguishing a product or service from others in the market to make it more attractive to a particular target market.

Free Entry

The condition in which new firms can enter the market with no or minimal barriers, promoting competition.

Imperfect Competition

Imperfect competition describes a market structure where the conditions for perfect competition are not met, due to factors like monopolies and product differentiation.

Monopolistic Competition

A market structure in which many companies sell products that are similar but not identical, allowing for competition based on price, quality, and innovation.