Under Which Condition Would the Fed Be Most Likely to Engage

question 77

Multiple Choice

Under which condition would the Fed be most likely to engage in its role as the lender of last resort?

• A) when throngs of borrowers apply for loans as the housing market picks up
• B) when a stock market crash causes people to sell their stocks and purchase bank CDs instead
• C) if a lack of confidence in the financial system causes savers to withdraw money from banks
• D) when record amounts of student loans are paid back before interest rates rise

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Definitions:

Nucleic Acid

Macromolecules, such as DNA or RNA, that store and transfer genetic information in cells, fundamental to the function of living organisms.

Organic Groups

Chemically refers to molecules that contain carbon and hydrogen, typically associated with living organisms.

Coenzyme

An organic non-protein compound that binds with an enzyme to catalyze a reaction, essential for the function of many enzymes.

Organic Molecule

A compound containing carbon atoms bonded to hydrogen atoms and often other elements, fundamental to the chemistry of life.