Post Utme Pan Atlantic University 2019 Commerce Question 1

Practice objective / multiple choice question 1 from the 2019 Post Utme Pan Atlantic University Commerce examination.

Post Utme Pan Atlantic University 2019 Commerce Objective / Multiple Choice
Question 1 POST_UTME_PAN-ATLANTIC_UNIVERSITY • 2019 • COMMERCE • objective

The Central Bank of Nigeria (CBN) uses the monetary policy instrument of Open Market Operations (OMO) to influence the money supply in the economy. Which of the following is a correct description of OMO?

Answer Options

A. The CBN sells government securities to commercial banks to reduce the money supply.
Correct Answer B. The CBN buys government securities from commercial banks to increase the money supply.
C. The CBN lends money to commercial banks at a low interest rate to increase the money supply.
D. The CBN sells government securities to commercial banks at a high interest rate to reduce the money supply.
Correct Answer
B
Correct Option:
The CBN buys government securities from commercial banks to increase the money supply.

About This Question

This is Post Utme Pan Atlantic University 2019 Commerce Question 1. It is one of the objective questions from the 2019 Post Utme Pan Atlantic University Commerce examination.

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