The Trading Desk Has Determined That a Positive Reserve Need

question 36

Multiple Choice

The Trading Desk has determined that a positive reserve need exists but expects the need to be temporary. What can the manager do to temporarily increase the amount of reserves in the system?

• A)engage in open market outright purchases
• B)engage in open market outright sales
• C)engage in a system repurchase agreement
• D)engage in a reverse repurchase agreement

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Definitions:

Nontaxable Social Security

Portions of Social Security benefits that are not subject to federal income tax under certain conditions.

AGI

Adjusted Gross Income; a measure of income calculated from your gross income and used to determine how much of your income is taxable.

Child and Dependent Care Credit

A tax credit in the U.S. for qualified expenses paid for the care of children under 13 or disabled dependents, enabling the taxpayer to work or look for work.

Qualified Day Care

A childcare facility meeting specific regulatory standards and qualifications, which expenses for may be deductible or eligible for specific tax credits.