Which of the Following Is a Liability on the Balance

question 428

Multiple Choice

Which of the following is a liability on the balance sheet of the Federal Reserve System?

• A) Federal Reserve notes
• B) U.S. government securities
• C) loans to depository institutions
• D) None of the above are correct because they are all liabilities of the Federal Reserve

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Definitions:

Commercial Bank Loans

are loans that businesses and individuals can obtain from a commercial bank to finance various needs, such as business expansion or personal expenses.

Short-Term Financing

Refers to borrowing funds for a period of less than one year to meet immediate financial requirements.

Spontaneous Financing

Financing that naturally increases as a firm's operating levels increase, typically through trade credits and accruals.

Five Year Bonds

Debt securities issued with a maturity of five years, typically paying interest semi-annually.