The two major policy instruments of the monetary policy are:

Question

bank loans to commercial banks and open market policy

the bank rate and the money supply

open market policy and accommodation policy

banks loans to commercial banks and the switching operations

Answer 1

The two major policy instruments of monetary policy are generally considered to be the bank rate and open market operations.

Here's a brief explanation of each:

1. Bank Rate: This is the interest rate at which the central bank lends money to commercial banks. It influences the rates that banks charge consumers and businesses for loans, impacting overall economic activity.

2. Open Market Operations: This involves the buying and selling of government securities in the open market by the central bank to regulate the money supply and influence interest rates.

Therefore, among the options you provided, "the bank rate and the money supply" is the closest to being correct in terms of major instruments used in monetary policy, acknowledging that the money supply itself is influenced by the policies implemented.

If you were to focus strictly on different categories, then the first option (bank loans to commercial banks and open market policy) could also be considered, but it’s less precise in defining the major instruments as commonly recognized.