BANKING AFFAIRS

Detailed explanation-1: -Open market operations refers to buying and selling of Government securities and treasury bills by the central bank with a view to regulate the supply of money in the economy.

Detailed explanation-2: -Open market operations. Buying and selling of government securities by the central bank from or to the public and banks are known as open market operations. It is an instrument of credit control which was used later when the bank rate policy was found ineffective.

Detailed explanation-3: -Open market operations refer to the selling and purchasing of the treasury bills and government securities by the central bank of any country in order to regulate money supply in the economy. It is one of the most important ways of monetary control that is exercised by the central banks.

Detailed explanation-4: -In macroeconomics, an open market operation (OMO) is an activity by a central bank to give (or take) liquidity in its currency to (or from) a bank or a group of banks.

Detailed explanation-5: -True. To check depression the central bank should purchase government securities from the open market, so as to increase the availability of credit in the economy.