The Set of Actions Taken by the Central Bank in Order

question 40

Multiple Choice

The set of actions taken by the central bank in order to affect the money supply is known as

• A) banking functions.
• B) procedures.
• C) negotiated policies.
• D) monetary policy.

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Definitions:

Moral-Hazard

Moral hazard is a situation in which one party is more likely to take risks because the negative consequences of the risk will be felt by another party.

Monitoring Employees

The process of overseeing employees' work activities and performance, often through the use of technology or other means.

Asymmetric Information

A situation in which one party in a transaction has more or superior information compared to another.

Prevalent

Widespread in a particular area at a particular time; commonly occurring or accepted.