Which of the Following Generally Occurs When a Central Bank

Multiple Choice

Which of the following generally occurs when a central bank pursues expansionary monetary policy?

A) The central bank purchases bonds and the interest rate decreases.
B) The central bank sells bonds and the interest rate increases.
C) The central bank purchases bonds and the interest rate increases.
D) The central bank sells bonds and the interest rate decreases.
E) The central bank purchases reserves and the interest rate decreases.