question archive Which of the following is not a major advantage of open market operations (OMO) as a tool of monetary policy? a
Which of the following is not a major advantage of open market operations (OMO) as a tool of monetary policy? a
Subject:EconomicsPrice:2.88 Bought3
Which of the following is not a major advantage of open market operations (OMO) as a tool of monetary policy?
a. OMOs are good for everyday use.
b. Purchases and sales take place daily (or close to it).
c. It's easy to find banks willing to transact with the Fed.
d. Each OMO transaction is very large.
Purchase A New Answer
Custom new solution created by our subject matter experts
GET A QUOTE
Answer Preview
The answer is a).
Open market operations are regarded as discretionary monetary policies, that they are to be exercised under the discretion of monetary policymakers. Therefore, these operations are not likely to be used on a daily basis. Instead, they tend to be use during extraordinary times, such as recessions.
