From a Bank Manager's Perspective, the Differential in Interest Between

question 19

Multiple Choice

From a bank manager's perspective, the differential in interest between a bank's loans and its deposits;

• A) must not exceed the federal funds rate.
• B) is called the primary credit lending rate.
• C) must be sufficient to cover the bank's other expenses and generate a reasonable profit for the bank's owners.
• D) must be sufficient to cover the bank's deposit insurance premiums and its reserve requirements at the Federal Reserve.

---

Definitions:

Aggregate Supply Curve

A graph that shows the relationship between the overall price level in an economy and the total output (goods and services) that producers are willing to supply.

Aggregate Demand

The total demand for all goods and services in an economy at a given overall price level and in a given time period.

Real GDP

Gross Domestic Product adjusted for inflation, providing a more accurate measure of an economy's size and how it's growing over time.

Aggregate Demand Curve

The aggregate demand curve represents the total quantity of all goods and services demanded by the economy at different price levels.