The Panic of 1873 Began When

question 18

Multiple Choice

The panic of 1873 began when:

• A)the Federal Reserve began to require banks to hold reserves and meet capital requirements.
• B)the Civil War started.
• C)Jay Cooke and Co., a financial firm that was heavily invested in the railroad industry, failed.
• D)Franklin Delano Roosevelt declared a bank holiday.

---

Definitions:

Nonnegotiable

Pertaining to something that cannot be transferred or assigned from one party to another, such as a nonnegotiable instrument or document.

Negotiable Instrument

A written document guaranteeing the payment of a specific amount of money, either on demand or at a set time, with the payer named on the document.

Loan

A sum of money that is borrowed and is expected to be paid back with interest.

Prime Rate

The interest rate that commercial banks charge their most creditworthy customers, often used as a benchmark in lending rates.