Which of the Following Is Considered a Characteristic of a Nondeposit

question 36

Multiple Choice

Which of the following is considered a characteristic of a nondeposit liability?

• A)freedom from reserve requirements
• B) not subject to Regulation Q ceilings
• C) freedom of banks to pay the prevailing interest rate in the market
• D) All of the above are correct.

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Definitions:

Monetary Policy

The process by which the monetary authority of a country controls the supply of money, often targeting an inflation rate or interest rate to ensure price stability and general trust in the currency.

Say's Law

An economic principle that asserts that supply creates its own demand, meaning that production of goods and services creates an equal amount of demand for those goods and services.

Classical Economics

Laissez-faire economics. Our economy, if left free from government interference, tends toward full employment. The prevalent school of economics from about 1800 to 1930.

Fiscal Policy

Manipulation of the federal budget to attain price stability, relatively full employment, and a satisfactory rate of economic growth.