In Recent Years (After the fiNancial Crisis of 2008), the Fed

question 184

Multiple Choice

In recent years (after the financial crisis of 2008) , the Fed has added a new element to its open-market operations, which is

• A) buying and selling foreign-government securities.
• B) taking government bonds as collateral on loans to banks and other financial institutions.
• C) the trading of state- and local-government bonds.
• D) accepting corporate stocks and bonds as bank reserves.

---

Definitions:

Loss on Sale

The financial loss incurred when the selling price of an asset is less than its carrying amount at the time of sale.

Statement of Cash Flows

A financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents, broken down into operating, investing, and financing activities.

Financing Activities

Transactions and events where cash is obtained from or repaid to investors and creditors excluding suppliers, which affect a company's equity or borrowings.

Cash Payments

Outflows of cash to settle obligations or purchase goods and services, as documented in the cash flow statement.