Which one of the following is a tool of monetary policy often used by the Fed for altering the reserves of commercial banks?
A) Issuing currency
B) Check collection
C) Open-market operations
D) Required reserve ratio

Question

Quizplus · Accepted Answer

Open-market operations refer to the buying or selling of government securities by the Federal Reserve in order to alter the reserves of commercial banks. This is a common tool used by the Fed for implementing monetary policy. The other options listed are not specifically related to altering the reserves of commercial banks.

Which One of the Following Is a Tool of Monetary