In 1873, British Economist Walter Bagehot Proposed That the Central

question 51

Essay

In 1873, British economist Walter Bagehot proposed that the central bank function as the lender of last resort. Specifically, he suggested the central bank lend freely to banks which have good collateral at high rates of interest. Why the requirements of good collateral and a high rate of interest?

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Definitions:

Bipedalism

The ability to walk on two legs, a key characteristic that distinguishes humans and their ancestors from other primates.

Shoulders

The region where the arm connects to the trunk of the body, encompassing several joints, muscles, and tendons, crucial for a wide range of movements.

Extensive Range

A broad area or scope over which something is spread or can operate, often used to describe geographic or ecological distributions.

Bipedalism

The ability to walk upright on two feet, a characteristic feature of humans and their ancestors.