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:

False Belief Task

A cognitive experiment used to assess an individual’s ability to understand that others can hold beliefs that are different from the individual's own and may not reflect reality.

Developmental Psychologists

Professionals who study the growth and development of the human mind and behavior across the lifespan.

Theory of Mind

Theory of Mind is the ability to attribute thoughts, desires, and intentions to oneself and others, understanding that others have beliefs and perspectives different from one's own.

Subconscious Awareness

The part of the mind that is not currently in focal awareness yet influences thoughts, feelings, and actions.