Instrument used by Federal Reserve to smooth money supply and interest rates includes
A. treasury notes
B. repurchase agreements
C. commercial payable notes
D. commercial receivable notes
Answer: Option B
Solution (By Examveda Team)
Instrument used by Federal Reserve to smooth money supply and interest rates includes repurchase agreements. A repurchase agreement (repo) is a form of short-term borrowing for dealers in government securities. In the case of a repo, a dealer sells government securities to investors, usually on an overnight basis, and buys them back the following day.This Question Belongs to Management >> International Finance And Treasury
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