If the Fed Sells Bonds Through Its Open Market Operations

question 284

Multiple Choice

If the Fed sells bonds through its open market operations, then there is

• A) an increase in the demand for bonds and a rise in the price of existing bonds.
• B) an increase in the supply of bonds and a fall in the price of existing bonds.
• C) a decrease in interest rates because of the increase in the supply of bonds.
• D) a decrease in interest rates because of the decrease in the demand for bonds.

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Definitions:

Corporate Welfare

Financial assistance, tax incentives, and other supportive measures provided by the government to corporations, often criticized as favoritism towards big business.

Environmental Justice

The movement aimed at addressing and remedying the disproportionate environmental burdens faced by marginalized communities due to policies and practices that disregard their environmental rights.

Policy, Economics

The study and analysis of how economic theories and principles influence and are applied to public policy, including the impact of government actions on economic performance.

Meaningful Involvement

Participation that is not only active but also has significance and influence on the outcome of processes or decisions in which one is involved.