Answer :

If the fed carries out an open market sale of u. S. Government securities, the number of bank reserves falls and the money supply decreases.

They may be known as securities because there may be a secure monetary contract this is transferable, meaning it has clear, standardized, diagnosed terms, so may be bought and bought via the financial markets.

Securities are fungible and tradable financial contraptions used to elevate capital in public and private markets. There are mainly 3 kinds of securities: equity—which affords possession rights to holders; debt—essentially loans repaid with periodic bills; and hybrids—which integrate aspects of debt and equity.

Bonds are commonly called constant-income securities and are one of the primary asset lessons that individual investors are commonly familiar with, together with shares (equities) and coins equivalents.

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