Open market operations are typically repurchase agreements. What does this tell you about the likely volume of defensive open market operations relative to the volume of dynamic open market operations?

• Defensive operations are usually common and that the dynamic open market operations is smaller than the volume of the defensive open market operations.

Explanation:

Open market operations is when treasury bills and securities are on sale in an economy. It is typically bought by the central bank to ensure that money is available in an economy.

Open market operations are typically repurchase agreements tells us that defensive operations are usually common and that the dynamic open market operations is smaller than the volume of the defensive open market operations.

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