To Prevent Shortages of Cash During a Crisis,the Fed

question 24

Multiple Choice

To prevent shortages of cash during a crisis,the Fed:

• A)saves up cash in bank vaults around the country and the world.
• B)reduces liquidity in the economy so that more cash can be saved.
• C)sells U.S.government securities to commercial banks.
• D)demands interest payments on reserves held at the Fed.
• E)increases the discount rate.

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Definitions:

Job Design

The process of organizing tasks, duties, and responsibilities into a productive work unit within an organization.

Cost of Capital

The rate of return a company must earn on its investment projects to maintain its market value and attract funds.

Integration

The process of combining or coordinating separate elements or groups into a unified whole, often seen in social, technological, and business contexts.

Authority

The competency to order, determine outcomes, and demand conformity.