Which of the Following Observations Concerning the Fed's Discount Window

question 86

Multiple Choice

Which of the following observations concerning the Fed's discount window is true?

• A)The facility is provided to meet DIs' permanent liquidity needs.
• B)Four lending programs are offered through the Fed's discount window.
• C)Primary credit is available to sound depository institutions on a very short-term basis.
• D)Secondary credit is available only to depository institutions that are eligible for primary credit.
• E)Eligible institutions for seasonal credit are big banks located in urban areas.

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Definitions:

Quantity Variance

The difference between the expected and actual quantities of inputs used in the production process, affecting the cost of goods sold.

Price Variance

The difference between the actual cost of a good or service and its expected or budgeted cost.

Total Cost Variance

The difference between the actual cost incurred and the standard cost, reflecting how well costs are controlled during a production process.

Factory Overhead Cost

All of the costs of producing a product except for direct materials and direct labor.