Federal Reserve Banks Do All of the Following Except One

question 37

Multiple Choice

Federal Reserve banks do all of the following except one.Which is the exception?

• A)hold member banks' reserves on deposit
• B)make loans to member banks
• C)issue bank notes
• D)serve as bankers to the federal government
• E)hold deposits of households and firms

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Definitions:

Regressive Tax

A tax levied in a way where the rate of taxation diminishes as the taxable amount gets larger.

Proportional Tax

A taxation system where the tax rate remains constant regardless of the amount subject to tax.

Progressive Tax

A tax system where the tax rate increases as the taxable amount or income rises, meaning higher earners pay a larger percentage of their income in taxes than lower earners.

Progressive Tax

A tax system where the tax rate increases as the taxable amount increases, meaning higher income individuals pay a larger percentage of their income in taxes compared to lower-income individuals.