Which of the Following Is an Action of Central Banks

question 19

Multiple Choice

Which of the following is an action of central banks and governments to lessen the severity of a banking crisis?

• A)maturity transformation
• B)relaxing bank capital requirements
• C)acting as a lender of last resort
• D)opening a liquidity trap

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Definitions:

Thorndike's Instrumental

A learning principle proposed by Edward Thorndike, emphasizing that behaviors followed by satisfying consequences are more likely to recur, whereas those followed by unpleasant consequences are less likely.

Skinner's Operant

A theory developed by B.F. Skinner that describes how behaviors are influenced by consequences, emphasizing reinforcement and punishment in shaping behavior.

Basal Ganglia

Subcortical forebrain nuclei that coordinate voluntary movements of the limbs and body; connected to the thalamus and to the midbrain.