When the Fed Engages in an Overnight Reverse Repo

question 7

Multiple Choice

When the Fed engages in an overnight reverse repo

• A)a bank agrees to hold a certain amount of clearing balances at the Fed.
• B)the fed sells securities and agrees to buy them back in one day.
• C)a primary government securities dealer agrees to sell a security to the Fed one day and buy it back the next day.
• D)The Fed repossesses property that a bank owns as punishment for the bank's failure to pay off a discount loan.

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Definitions:

Respectful Close

A polite and considerate way to end a communication or interaction, ensuring a positive impression.

Indirect Approach

A communication strategy where the main point is not presented directly at the beginning but is introduced later in the message.

Refusing Claims

The act of denying or rejecting claims, often in the context of insurance or customer service disputes.

Adjustments

Changes or modifications made to improve a system, process, or document.