To prevent shortages of cash during a crisis, the Fed:
a. saves up cash in bank vaults around the country and the world.
b. reduces liquidity in the economy so that more cash can be saved.
c. sells U.S. government securities to commercial banks
d. demands interest payments on reserves held at the Fed.
e. increases the discount rate.
a
Economics
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Jimmy's utility of wealth schedule is given in the table above. Jimmy has a job with a one-third chance of earning $200 and a two-thirds chance of earnings $400. Jimmy's cost of risk is
A) $0. B) $16.67. C) $33.33. D) Jimmy's cost of risk cannot be determined without more information.
Economics
Describe the extensive "safety net" that has been set up in the United States in order to reduce the risk of bank failure
What will be an ideal response?
Economics