Question

Open market operations A. inject reserves into the banking system when the Federal Reserve sells U.S. government securities. B. are the purchase and sale of existing U.S. government securities by the Federal Reserve. C. are directed by the Board of Governors. D. All of the above

Answer 1

The Correct Answer is A

Step-by-step explanation:

• Open market operations associated with central bank takeovers and purchases of government contracts to grow or consume capital in the banking practice and control interest charges.
• The Federal Reserve purchases and auctions government bonds to regulate the capital supply. This movement is called open market operations.

Answer 2

C. are directed by the Board of Governors.

Step-by-step explanation:

Open market operations are conducted by the central bank of the country which is Fed which comprises of purchasin and selling existing US government securities to change the money supply in the economy which is part of monetary policy.