Everything Else Held Constant,in the Market for Reserves,when the Federal

question 84

Multiple Choice

Everything else held constant,in the market for reserves,when the federal funds rate is 3%,raising the discount rate from 5% to 6%

• A)lowers the federal funds rate.
• B)raises the federal funds rate.
• C)has no effect on the federal funds rate.
• D)has an indeterminate effect on the federal funds rate.

---

Definitions:

Inventory Turnover

A proportion indicating the frequency with which a business has sold its inventory and replenished it within a specific timeframe.

Current Liabilities

Financial obligations of a business that are due and payable within one year, including accounts payable, short-term debt, and other short-term obligations.

Quick Ratio

The quick ratio, or acid-test ratio, measures a company's ability to meet its short-term obligations with its most liquid assets.

Current Ratio

A financial metric used to evaluate a company's ability to pay short-term obligations, calculated by dividing current assets by current liabilities.