Compared to typical open-market operations, when engaging in quantitative easing operations conducted by the Federal Reserve between 2007 and 2011, Federal Reserve purchases tended to be _____ securities.
A)safer and shorter-term
B)tax-favoured and foreign
C)smaller-denomination and higher-grade
D)riskier and longer-term

Question

Quizplus · Accepted Answer

During quantitative easing, the Federal Reserve purchased longer-term and riskier securities, such as long-term Treasury bonds and mortgage-backed securities, to lower long-term interest rates and stimulate the economy.

Compared to Typical Open-Market Operations, When Engaging in Quantitative Easing