Is there any difference between borrowing from the federal funds market and borrowing from the discount window? Explain
What will be an ideal response?
The federal funds market refers to the market where banks obtain overnight loans of reserves from one another. On the other hand, when banks are not granted funds from the federal funds market, they can borrow from the Fed. This is referred to as borrowing from the discount window.
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Refer to Figure 7.1. Suppose that instead of $350, Angus earns only $250 by playing the bagpipes, but all other earnings remain the same. If there is no ordinance against loud music, the Coase theorem predicts that
A) Dudley will pay Angus to not play the bagpipes. B) Angus will pay Dudley so Angus can play the bagpipes. C) Dudley will do nothing and Angus will mop floors. D) no bargain can be reached between Angus and Dudley.
Which of the following countries have liberalized their economies and substantially improved their economic freedom rating since 1990?
a. Argentina and Brazil b. Zimbabwe and the Republic of Congo. c. Estonia and India d. Italy and France
What happens to the price and quantity sold of a drug when its patent runs out? (i) The price will fall. (ii) The quantity sold will fall. (iii) The marginal cost of producing the drug will rise
a. (i) only b. (i) and (ii) only c. (ii) and (iii) only d. (i), (ii), and (iii)
In the long run, a reduction in labor supply would cause output to ________ and the aggregate price level to ________.
A. rise; rise B. fall; fall C. fall; rise D. rise; fall