Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Money and Banking

Question:

Buying of securities by Central Bank of a country is.

Options:

Expansionary monetary policy

Contractionary monetary policy

Neutral monetary policy

Anti-inflationary monetary policy

Correct Answer:

Expansionary monetary policy

Explanation:

The correct answer is Expansionary monetary policy.

When a central bank buys securities, it is injecting money into the economy. This can lead to lower interest rates, which can stimulate economic growth. This type of monetary policy is known as expansionary monetary policy.