NOW Accounts Were Developed in Order to

question 43

Multiple Choice

NOW accounts were developed in order to

• A)circumvent Regulation Q.
• B)provide banks with a checkable deposit on which they did not have to pay interest.
• C)provide banks with a liquid, interest-earning asset.
• D)provide banks with a means of earning interest on the funds in their reserve accounts with the Fed.

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Definitions:

Output

The total amount of goods or services produced by a company, industry, or economy over a certain period.

Elastic Range

The segment of a demand curve where any change in price leads to a more than proportionate change in the quantity demanded.

Pure Monopolist

A sole producer in a market with no close substitutes for the product, allowing for the control of price.

Marginal Revenue

The supplementary earnings obtained from the sale of one more unit of a product or service.