When the Central Bank Acts as a Lender of Last

question 106

Multiple Choice

When the central bank acts as a lender of last resort, it:

• A)raises reserve requirements.
• B)reduces reserve requirements.
• C)provides a liquidity trap.
• D)provides funds to financial institutions that cannot borrow from the private credit markets.

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Definitions:

Estate

The total of all the assets, properties, and liabilities that a person leaves behind upon death.

Fraud

(1) An intentional deception that causes harm to another. (2) A basis for contesting a will if the testator relied on false statements when he or she made the will.

False Statements

Assertions or claims that are not true, which in certain contexts, such as under oath in court or in financial reporting, can be illegal or fraudulent.

Undue Influence

A legal term referring to a situation where an individual is able to persuade another's decisions due to the relationship between the two parties.