Depository Institutions (DIs)play an Important Role in the Transmission of Monetary

question 7

Multiple Choice

Depository institutions (DIs) play an important role in the transmission of monetary policy from the Federal Reserve to the rest of the economy because

• A)loans to corporations are part of the money supply.
• B)bank and thrift loans are tightly regulated.
• C)U.S. DIs compete with foreign financial institutions.
• D)DI deposits are a major portion of the money supply.
• E)thrifts provide a large amount of credit to finance residential real estate.

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Definitions:

Preference

A consumer's choice or inclination towards a certain product, brand, or service over others, based on their perceptions, experiences, and individual tastes.

Paradox

A statement or situation that despite sound reasoning from acceptable premises, leads to a conclusion that seems senseless, logically unacceptable, or self-contradictory.

Consciously Choosing

The act of making deliberate and aware decisions regarding purchases or other life choices.

Subjectively Selecting

The process of choosing or making decisions based on personal feelings, tastes, or opinions rather than external evidence or criteria.