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

question 28

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

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Definitions:

Peritubular Capillaries

Tiny blood vessels that travel alongside nephrons allowing reabsorption and secretion between blood and the inner lumen of the nephron.

Bowman's Capsule

A structure in the kidneys that encases the glomerulus and is involved in the filtration process of blood to form urine.

Glomerulus

A network of capillaries located at the beginning of a nephron in the kidney, crucial for the filtration of blood to form urine.

Nephron

The basic structural and functional unit of the kidney, responsible for filtering blood and producing urine.