Discounting Refers to the Fed's Practice of

question 113

Multiple Choice

Discounting refers to the Fed's practice of

• A)Selling securities at the federal funds rate.
• B)Purchasing securities at the lowest available federal funds rate.
• C)Lending reserves directly to private banks.
• D)Lending at the prime rate.

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Definitions:

Actuarial Assumptions

The hypotheses about demographic, financial, and other variables that actuaries use to calculate the liabilities and expenses of insurance and pension plans.

GAAP Standards

Generally Accepted Accounting Principles; a set of rules and standards used for financial reporting and accounting in the United States.

Pension Asset

Refers to the resources set aside by a company in a pension fund to meet future pension liabilities to its employees.

Projected Benefit Obligation

A measurement of the present value of future pension benefits earned to date as estimated by actuaries, used in accounting for pension plans.