Answer: c. interest rate falls; investment rises
Step-by-step explanation:
The Fed buying treasury securities from banks is an expansionary policy when the government wants to increase the money in circulation and increase economic growth.
When the Fed buys Treasury securities from banks, this will lead to availability of funds as prices will be pushed higher and there will be a reduction in the interest rate.
Since there is reduction in interest rate, investment will increase as investors will borrow from banks.