Which of the Following Is a Mechanism Used by FI

question 32

Multiple Choice

Which of the following is a mechanism used by FI managers to reduce demand deposit withdrawal rates?

• A)implicit interest payments
• B)minimum balance requirements
• C)explicit interest payments
• D)There is no way to mitigate withdrawal risk.

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Definitions:

Know-Nothing Party

A nativist political party in the United States during the 1850s that opposed immigration and favored policies that would "purify" American politics.

Republican Party

A major political party in the United States that is associated with conservative and right-leaning policies.

Democratic Party

One of the two major political parties in the United States, traditionally associated with progressive and liberal policies.

Whig Party

A political party active in the middle of the 19th century in the United States, which was opposed to the policies of the Democratic Party and advocated for a more active role of the federal government, especially in supporting a market economy.