Prior to the financial crisis, the Fed held less than $1 trillion in assets and most were in safe U S government securities By mid December, 2008, the Fed 's balance sheet had increased to over $2 3 trillion The massive expansion began when the Fed rolled out its lending program sending banks cash ...

The Federal Reserve has three policy tools required re ...

Prior to the financial crisis, the Fed held less than $1 trillion in assets and most were

Question:

Prior to the financial crisis, the Fed held less than $1 trillion in assets and most were in safe U.S. government securities. By mid-December, 2008, the Fed's had increased to over $2.3 trillion. The massive expansion began when the Fed rolled out its lending program: sending banks cash in exchange for risky assets.
What are the Fed’s policy tools and which policy tool did the Fed use to increase its assets to $2.3 trillion in 2008?
Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...