If,after a Deposit Outflow,a Bank Needs an Additional $3 Million

question 102

Multiple Choice

If,after a deposit outflow,a bank needs an additional $3 million to meet its reserve requirements,the bank can

• A) reduce deposits by $3 million.
• B) increase loans by $3 million.
• C) sell $3 million of securities.
• D) repay its discount loans from the Fed.

---

Definitions:

Labor Market

The supply and demand for labor, where employers seek to hire employees and employees seek jobs, and wages are determined.

Income-Maintenance Programs

Government programs designed to provide financial assistance to individuals or households to ensure a minimum level of income.

Aggregate Spending

The total amount of spending in an economy, including consumption, investment, government purchases, and net exports.

Medicare

In the United States, a national health coverage scheme available to individuals over 65, younger persons with specific disabilities, and those suffering from End-Stage Renal Disease.