8. The Discount Rate The refinancing rate is the interest rate a central bank like the Bank of England or European Central Bank (ECB) charges on short-term loans to the banking sector. Which of the following statements about the refinancing rate are true? Check all that apply. = The refinancing rate is a primary barometer of central bank policy reported in the media. If the central bank wants to contract the monetary supply, it raises the refinancing rate. = A higher refinancing rate encourages banks to borrow reserves and make loans. To meet their liquidity requirements, banks agree to repurchase assets put up as collateral for loans from the central bank.

8. The Discount Rate The refinancing rate is the interest rate a central bank like the Bank of England or European Central Bank (ECB) charges on short-term loans to the banking sector. Which of the following statements about the refinancing rate are true? Check all that apply. = The refinancing rate is a primary barometer of central bank policy reported in the media. If the central bank wants to contract the monetary supply, it raises the refinancing rate. = A higher refinancing rate encourages banks to borrow reserves and make loans. To meet their liquidity requirements, banks agree to repurchase assets put up as collateral for loans from the central bank.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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