An open market sale of government securities by the central bank will:

CA Foundation · Business Economics · MTP · May 2026
An open market sale of government securities by the central bank will:
(A) A. Increase money supply
(B) B. Decrease money supply
(C) C. Leave money supply unchanged
(D) D. Increase fiscal deficit

Suggested Answer and Working Notes:

Correct Answer: Option (B)

B. Decrease money supply

Topics: Money Market

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