30. TheFederal Reserve sells $50 billion of short-term U.S. Treasurysecurities t

Question

30. TheFederal Reserve sells $50 billion of short-term U.S. Treasurysecurities to the public, other things held constant, what would bethe most likely effect on short-term securities prices and interestrates? (Points: 4)
      Prices andinterest rates will both rise.
       Prices will rise and interest rates willdecline.
       Prices and interest rates will bothdecline.
       Prices will decline and interest rates willrise.
       There is no reason to expect a change in eitherprices or interest rates.

Explanation / Answer

If the Federal Reserve sells $50 billion of short-term U.S.Treasury securities to the public, "The Prices will declineand Interest Rates will rise".

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