If the Fed Makes a Discount Loan of $2 Million

question 89

Multiple Choice

If the Fed makes a discount loan of $2 million to a commercial bank, the Fed's balance sheet will show

• A)an increase in discount loans of $2 million and an increase in bank reserves of $2 million.
• B)an increase in discount loans of $2 million and a decrease in bank reserves of $2 million.
• C)a decrease in discount loans of $2 million and an increase in bank reserves of $2 million.
• D)a decrease in discount loans of $2 million and a decrease in bank reserves of $2 million.

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Definitions:

Neural Synchrony

The simultaneous firing of neurons in different parts of the brain, which is believed to be crucial for various cognitive functions, including attention and perception.

Vertical Line

A straight line that runs up and down, perpendicular to a horizontal line.

Attributes

Qualities or features regarded as inherent parts or characteristics of someone or something, defining or identifying aspects.

Unconscious Inference

A theory suggesting individuals make automatic, rapid judgments about sensory information without being aware of the process.