The Fed's Lender-Of-Last-Resort Function

question 23

Multiple Choice

The Fed's lender-of-last-resort function

• A)has proven to be ineffective.
• B)cannot prevent runs by large depositors.
• C)is no longer necessary due to FDIC insurance.
• D)creates a moral hazard problem.

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Definitions:

Manufacturer

A person or company that makes goods for sale, especially on a large scale or using industrial processes.

Fewer Than 500

A phrase typically used to describe the size of a business, indicating it employs less than 500 people, often classifying it as a small or medium enterprise (SME).

U.S. Census Bureau

A federal agency tasked with collecting and analyzing data about the American people and economy.

Closed Businesses

Companies that have ceased operations permanently, often due to financial troubles, market competition, or other external factors.