The Fed Does Not Tightly Control the Monetary Base Because

question 116

Multiple Choice

The Fed does not tightly control the monetary base because it does NOT completely control

• A)open market purchases.
• B)open market sales.
• C)borrowed reserves.
• D)the discount rate.

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Definitions:

Securities

Securities that signify ownership in a corporation listed on the stock market, a debt obligation with a government entity or company (bond), or entitlements to ownership through an option.

Day of Record

The date set by a company on which the investors must be on the company's books in order to receive a dividend.

Money Market Instruments

Short-term debt instruments, usually with a maturity of less than one year, used for borrowing and lending in the money market.

Commercial Paper

An unsecured, short-term debt instrument issued by corporations to finance their immediate operational needs, characterized by its low-risk and short maturity period.