If the Fed Is Generous in Its Granting of Discount

question 3

Multiple Choice

If the Fed is generous in its granting of discount loans during a crisis,

• A)the result will likely be a contraction of the money supply.
• B)risk taking by banks and corporations may be encouraged.
• C)the discount rate will be bid up as the demand for loans exceeds the supply.
• D)market interest rates will rise sharply.

---

Definitions:

Defined

Clearly described, outlined, or explained.

Managers

are individuals within an organization responsible for planning, directing, and overseeing the work of a group of individuals.

Hazard

Something that has the potential to cause damage, harm, or adverse health effects to people or property.

Human-Made Structures

Objects or buildings created by humans rather than occurring naturally in the environment.