Question

The Federal Reserve purchases large amounts of treasury securities in order
to
A. slow down a period of rapid economic growth
B. stop banks from lending too much money,
C. Increase the available money supply
D. enforce regulations on its member banks.

Answer 1

Answer: C

Explanation: A-P-E-X

Answer 2

Increase the amount of money accessible.

Federal Reserve:

The entire quantity of money in a given economy at any one time is known as the supply of money.

An expansionary fiscal policy is the one where the Federal Reserve purchases significant amounts of government securities in order to expand the quantity of money money supply in the market.

Find more information about 'Supply of money'.

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