Question

What monetary policy does the government use the most to change the money supply?
Group of answer choices

monetary creation

adjusting the interest rates

open market operations

Discontinues certain banking practices

Answer 1

The monetary policy that the government (specifically, the central bank) uses the most to change the money supply is **open market operations**. This involves the buying and selling of government securities in the open market to influence the level of bank reserves and the overall money supply. While adjusting interest rates is also a key tool, it is often a result of actions taken through open market operations.