Macroeconomics
10th Edition
ISBN: 9781319105990
Author: Mankiw, N. Gregory.
Publisher: Worth Publishers,
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Question
Chapter 18, Problem 6QQ
To determine
The lender of last resort.
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Students have asked these similar questions
Banks don't lend out all of the funds deposited because:
A)
they need to make more money on interest-bearing deposits.
B)
they need to reduce their liquidity position.
C)
it would not be profitable.
D)
they have to satisfy any depositor who wants to withdraw funds.
A bank is an entity that A) qualifies for FDIC deposit insurance B c) accepts demand deposits D all these answers are correct E makes business loans channels funds from savers to borrowers.
The Federal Reserve system gets the money it needs for operating expenses
(Remember, pick the best answer.)
A. from Congress
B. from taxes
C. from the fees, it charges banks to take out loans from the Fed
D. from interest on government bonds
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Similar questions
- At the start of the 2008/2009 financial crisis, the Fed_____ in an attempt to pump reserves into the banking system. A)bailed out Lehman Brothers B)froze all desired reserves C)purchased failing banks D) double the monetary basearrow_forwardAs a "lender of last resort" the Fed :protects the deposits of $100,000 or less in all commercial banks in the country .bails out any depository institution it has decided should not be allowed to fail .bails out any corporation the government has decided should not fail .is obligated to bail out any depository institution in the country that is in financial difficultyarrow_forwardWhich of the following is not a function of the central bank? Select one: a. The issuance of bank notes and coins for the country b. Manage foreign exchange c. It acts as the Government’s bank d. Stimulate the economy through government spendingarrow_forward
- During financial crisis, BSP buys bonds in the commercial banks to increase money supply. True False When the rediscount rate rises, this gives more opportunity for the commercial banks or universal banks to borrow money from the BSP. True Falsearrow_forwardJFK increased trade with the newly created Common Matket (now called the blank) by blank What are the banks in this question?arrow_forwardThe importance of the Central Bank in the financial market.arrow_forward
- The Central Bank does all but which of the following? 1) conducts monetary policy 2) promotes stability of the financial system 3) 2 appoints senators to the Federal Reserve Board 4) provides banking services to certain banks and the federal governmentarrow_forwardThe net interest margin of a bank is a function of A What they pay for wages and the revenue B Their cost of funds and what they earn from giving out loans C Whatever the CEO and Board of Director think is fair D The marginal propensity to prosperityarrow_forward
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