In Practice, Discount Lending Is Used

question 31

Multiple Choice

In practice, discount lending is used

• A) to ease a financial panic.
• B) to control the money supply.
• C) to set a minimum for the federal funds rate.
• D) all of the above.

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Definitions:

Availability Bias

A cognitive bias that influences decisions based on the immediate examples that come to a person's mind.

Negotiation

A process of discussing issues openly and attempting to reach a joint decision or agreement.

Risk-Averse

The tendency to prefer avoiding losses over achieving equivalent gains.

Risk-Seeking

A behavioral trait of preferring or choosing options that have potentially higher gains albeit with higher risks.