Question

The Federal Open Market Committee meets eight times a year to maintain or change policy. A vote to change policy will result in

Answer 1

The correct answer is that a vote to change policy will result in a change in the short-term interest rate.

The FOMC is responsible for the large scale macroeconomic policy of the US and in that role is responsible for making adjustments to the interest rate to keep the country's economy stable.

Answer 2

The correct answer is D) either buying or selling U.S. government securities on the open market.

The other options of the question were A) increasing or decreasing spending on infrastructure. B) increasing or decreasing taxes to influence aggregate demand. C) increasing or decreasing spending on essential goods and services.

The Federal Open Market Committee meets eight times a year to maintain or change policy. A vote to change policy will result in either buying or selling U.S. government securities on the open market.

This is one of the policies the Federal Reserve can apply to control monetary operations and maintain the health of the United States financial system. Let's have in mind that the Fed or Federal Reserve plays the role of the Central bank of the United States. So, the Fed has to closely pay attention to the monetary policy in the country and maintain strict control of inflation.