When the Fed Conducts Open-Market Sales

question 45

Multiple Choice

When the Fed conducts open-market sales,

• A)it sells Treasury securities,which increases the money supply.
• B)it sells Treasury securities,which decreases the money supply.
• C)it auctions term loans,which increases the money supply.
• D)it auctions term loans,which decreases the money supply.

---

Definitions:

Private Offering

A funding method where securities are sold to a small number of selected investors instead of the general public, often to raise capital for a company.

Rule 10b-5

A regulation under the U.S. Securities Exchange Act of 1934 that prohibits fraud, misrepresentation, and insider trading in the securities market.

Conflict of Interest

A situation in which a person or entity has competing interests or loyalties that could potentially influence the objectivity of their decisions.

Securities Broker

A professional intermediary who facilitates the purchase and sale of securities on behalf of clients.