How does the federal reserve act to help prevent banking panics?
What will be an ideal response?
Answer: The fed acts as a lender of last resort, making loans to banks so they can pay off depositors.
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The Car Allowance Rebate System (CARS)
a. was launched as a stimulus program by the Reagan administration b. was introduced under the Consumer Assistance to Recycle and Save Act of 2009 c. is currently available to purchasers of plug-in hybrids d. was the first-ever Vehicle Accelerated Vehicles Retirement (VAVR) program
The variable measured on the y-axis increases whenever the variable measured on the x-axis increases. As a result, the relationship between the variables will
A) be negatively sloped. B) have a slope of zero. C) be a vertical line. D) be none of the above.
Borrowing to fund investment projects until the marginal rate of return falls to ________ is optimizing investment strategy for ________
A) the borrowing rate, businesses and governments B) the borrowing rate, businesses but not governments C) the borrowing rate, governments but not businesses D) zero, businesses and governments E) zero, governments but not businesses
According to the interest rate effect, an increase in the price level, if other factors are held constant, will lead to
A) a reduction in total real spending on interest-rate-sensitive goods. B) an increase in the stock of real wealth held by the public. C) an outward shift of the aggregate demand curve. D) an increase in the real interest rate.