(Answered) The Fed can change the equilibrium rate of interest by changingSelect…

➤ How do open market operations change the equilibrium interest rate?
When the Fed buys government securities, it adds reserves to the banking system, lowering the federal funds rate and other short‑term rates. Selling securities drains reserves and raises rates. These actions change liquidity, influence banks’ lending behavior, and move the market toward a new equilibrium interest rate.