In the Event of a Sudden Loss in Confidence in the Ability

question 39

Multiple Choice

In the event of a sudden loss in confidence in the ability of the commercial banks to redeem deposits,the Bank of Canada would probably

• A)take over the operation of any banks in severe difficulties.
• B)lend reserves to the commercial banks.
• C)offer to sell government bonds to the chartered banks.
• D)suspend operation of the banking system until the panic subsided.
• E)impose severe financial penalties on the commercial banks by charging them interest at higher than the Bank rate.

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Definitions:

Attitudes

A settled way of thinking or feeling about something, typically reflected in a person's behavior or expressed opinions.

Experimental Group

A group in a research study that receives the treatment or intervention under investigation to assess its effects compared to a control group.

Independent Variable

The variable in a scientific experiment that is manipulated or changed to observe its effect on the dependent variable.

Special Treatment

Exceptional or preferential handling or consideration given to individuals in a specific context.