Question

HELP PLZ WILL MARK AS BRAINLIEST!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! In two or three sentences, describe how open-market operations change the money supply.

Answer 1

The local bank decreases its credit form the larger bank and increases their supply of money. Can influence short-term interest to the bank.

Answer 2

The government securities that are used in open market operations are Treasury bills, bonds and notes.... Therefore, if the FOMC wants to decrease the money supply, it will sell securities. To increase the money supply in the market, the FOMC will purchase securities from banks.