09. When a private bank is faced with a reserve shortfall, a) it can borrow reserves from other banks or sell their more liquid assets such as mortgage and commercial loans. c) Legally, It has only days to shore-up its reserve position. d) Is likely to address the problem by just halting its lending and waiting for their existing loans to be repaid. it will most likely sell its real estate holdings and call-in their mortgages.

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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**QUESTION 9**

09. When a private bank is faced with a reserve shortfall,

- a) it can borrow reserves from other banks or sell their more liquid assets such as mortgage and commercial loans.
- b) Legally, it has only days to shore-up its reserve position.
- c) is likely to address the problem by just halting its lending and waiting for their existing loans to be repaid.
- d) it will most likely sell its real estate holdings and call-in their mortgages.

**QUESTION 10**

10. Which of the following are TRUE?

- a) The members of the Federal Reserve Board of Governors are appointed for 14-year terms in order to foster their independence from the politicians who appoint them and confirm their appointments.
- b) The monetary policy for the United States is set by the Board of Governors of the Federal Reserve.
- c) The Federal Open Market Committee is comprised of the seven members of the Board of Governors and five Presidents of the Federal Reserve Banks.
- d) The International Monetary Fund makes loans to countries for economic development projects.
- e) The Bank for International Settlements facilitates transactions between central banks.
Transcribed Image Text:**QUESTION 9** 09. When a private bank is faced with a reserve shortfall, - a) it can borrow reserves from other banks or sell their more liquid assets such as mortgage and commercial loans. - b) Legally, it has only days to shore-up its reserve position. - c) is likely to address the problem by just halting its lending and waiting for their existing loans to be repaid. - d) it will most likely sell its real estate holdings and call-in their mortgages. **QUESTION 10** 10. Which of the following are TRUE? - a) The members of the Federal Reserve Board of Governors are appointed for 14-year terms in order to foster their independence from the politicians who appoint them and confirm their appointments. - b) The monetary policy for the United States is set by the Board of Governors of the Federal Reserve. - c) The Federal Open Market Committee is comprised of the seven members of the Board of Governors and five Presidents of the Federal Reserve Banks. - d) The International Monetary Fund makes loans to countries for economic development projects. - e) The Bank for International Settlements facilitates transactions between central banks.
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