The Fact That, for Most of Its History, the Fed

question 64

Multiple Choice

 The fact that, for most of its history, the Fed was reluctant to make discount loans actually: ?

• A) at times was a destabilizing force for financial markets.?
• B) proved to be a very stabilizing force for financial markets.?
• C) pushed the discount rate above the target federal funds rate.?
• D) resulted in banks in very strong financial shape as being the only ones borrowing from the Fed.

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Definitions:

Output

The sum of all products or services generated by a company, sector, or economic system in a specified timeframe.

Zero Revenues

A situation where a business or organization does not generate any income from its activities or operations.

Profit-Maximizing Monopolist

A monopolist's strategy of setting a price and production level where marginal cost equals marginal revenue to achieve the highest possible profit.

Price-Elastic

A characteristic of goods or services for which demand significantly changes with small changes in price.