Statement I: If a Bank Has Negative Excess Reserves,then Its

question 77

Multiple Choice

Statement I: If a bank has negative excess reserves,then its required reserves are greater than its actual reserves.
Statement II: If a bank has negative excess reserves,it generally eliminates them by borrowing money in the Federal Funds market.

• A)Statement I is true and statement II is false.
• B)Statement II is true and statement I is false.
• C)Both statements are true.
• D)Both statements are false.

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Definitions:

Substantial Housing

Housing that is solidly built and provides adequate shelter and living conditions, meeting the basic physical and safety needs of its inhabitants.

Food Production

The processes involved in cultivating crops and raising livestock to produce food for consumption.

American Indians

Indigenous peoples of the Americas, often referred to as Native Americans, with diverse cultures, languages, and histories prior to European colonization.

Food Crops

Plants cultivated primarily for consumption by humans or livestock, including grains, fruits, and vegetables.