Question

Based on the information presented in the video, what is the main goal of buying and selling government securities?
Responses

to influence the Federal Funds Rate
to influence the Federal Funds Rate

to decrease the unemployment rate
to decrease the unemployment rate

to reduce the strength of US currency
to reduce the strength of US currency

to increase the inflation rate

Answer 1

to influence the Federal Funds Rate

Buying government securities injects reserves and lowers the federal funds rate; selling drains reserves and raises it.