Economics · Monetary Policy Instruments
Which of the following characteristics best distinguishes repo operations from the outright purchase/sale of securities by a central bank?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Repo operations are independent of the central bank's short-term monetary policy goals
- 2Repo operations involve a pre-specified repurchase/resale agreement at a fixed date✓
- 3Repo operations result in a permanent structural change in the money supply
- 4Repo operations are conducted only for long-term multi-year maturities
Correct answer
Repo operations involve a pre-specified repurchase/resale agreement at a fixed date
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