Which of the Following Is an Action of Central Banks

question 69

Multiple Choice

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

• A)establishing shadow banks
• B)guaranteeing bank deposits
• C)encouraging asset bubbles
• D)opening a liquidity trap

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Definitions:

Quotas

Quotas are government-imposed trade restrictions that limit the number or monetary value of goods that can be imported or exported during a specific time period.

Politically Influential

Describes individuals or groups that hold significant power to affect public policy or government actions.

Import Protections

Measures such as tariffs and quotas that countries implement to protect their domestic industries from foreign competition.

Consumer Surplus

The disparity between the amount consumers are prepared to spend on a product or service and the actual price they pay.