The Fed Is Said to Be the "Lender of Last

question 411

Multiple Choice

The Fed is said to be the "lender of last resort" in that

• A) it stands ready to lend to any depository institution that it has decided should not fail.
• B) it makes loans to individuals whom commercial banks do not believe are credit-worthy.
• C) it charges a higher interest rate to borrowers than does any other bank.
• D) it functions as the government's bank only when commercial banks fail to do so.

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Definitions:

Account

Response to a reproach.

Long-Distance Relationships

Romantic partnerships in which the individuals are geographically separated, requiring communication through electronic means or frequent travel.

Geographically Close

Describes a situation where individuals or entities are located within a short physical distance of one another.

Together

Being in close association or in a cooperative relationship with others.