Among the following which statement given is not true? a) If the central bank raises its refinancing rate, then the commercial banks will try to reduce their lending and so reduce the need to borrow from the central bank. b) Commercial banks may borrow from and lend to each other and the interest rate at which they do this is called the refinancing rate. c) The difference between the price at which a commercial bank sells an asset to the central bank and the price it agrees to buy it back can be expressed as an annualized percentage of the selling price, and this is called the refinancing rate. d) If the central bank has bought some assets from a commercial bank with an agreement that the commercial bank will buy them back at a later date, then this would be called a repo.

Among the following which statement given is not true? a) If the central bank raises its refinancing rate, then the commercial banks will try to reduce their lending and so reduce the need to borrow from the central bank. b) Commercial banks may borrow from and lend to each other and the interest rate at which they do this is called the refinancing rate. c) The difference between the price at which a commercial bank sells an asset to the central bank and the price it agrees to buy it back can be expressed as an annualized percentage of the selling price, and this is called the refinancing rate. d) If the central bank has bought some assets from a commercial bank with an agreement that the commercial bank will buy them back at a later date, then this would be called a repo.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Richie Rich has applied for a home equity loan. The bank on its part has estimated the market value of Richie's property at $750,000. If the amount of existing mortgage loan on the property is $500,000 and the bank lends only up to 70 percent of the borrowing base, what is the maximum amount of loan will Richard get? a.$175,000 b.$750,000 c.$100,000 d.$250,000
24)To reassure investors who were unwilling to buy mortgages in the secondary market, the U.S. Congress used two government-sponsored enterprises (GSEs) called, ________. The GSEs role was to sell bonds to investors and use the funds to purchase mortgages from _______. Select one: a. the Fed and the Treasury Department; Households b. the Fed and Treasury Department; Banks c. Fannie Mae and Freddie Mac; Households d. Fannie Mae and Freddie Mac; Banks e. Fannie Mae and Freddie Mac; Investment Banks
Buying and selling government securities to financial institutions is called: A. Open market operations B. Sales of stocks and bonds C. Growth of the Money Supply D. Closed market operations
Which of the following is TRUE about interest rates offered by financial Intermediaries? *A.The interest rates issued by financial intermediaries are standard across different financial institutions.B. Interest rates paid by DSUs are lower and SSUs are paid with higher interest rates.C. Interest rates issued by financial intermediaries are based solely on the issuance of central banks.D. Interest rates paid to SSUs are lower compared to the interest they collect to DSUs.
Please explain option a,b,c
1
Answer question 42
1. Fitch Ratings Inc. downgrades banks credit ratings. A. How does this affect borrowers, lenders, and financial institutions? B. What are the implications of this downgrade to the health of the financial system?
What is the role of banks as financial intermediaries? a) Savers go directly to the banks for funds. b) Banks issue bonds to finance their daily operations. c) Borrowers go directly to savers for funds. d) Savers deposit their funds into banks; banks extend loans to borrowers. e) Borrowers deposit their funds into banks; banks extend loans to savers. What is the role of banks as financial intermediaries? a) Savers go directly to the banks for funds. b) Banks issue bonds to finance their daily operations. c) Borrowers go directly to savers for funds. d) Savers deposit their funds into banks; banks extend loans to borrowers. e) Borrowers deposit their funds into banks; banks extend loans to savers..
How do we a measure a bank's capital? We subtract the assets from the liabilities, which is equal to the net worth We subtract the net worth from the assets, which is equal to the liabilities We subtract the liabilities from the assets, which is equal to the net worth We subtract the net worth from the liabilities, which is equal to the assets
The wow expert Hand written solution is not allowed. Give proper explanation of the answers provided.
Q5.Amir Khan has a savings bank account in HDFC bank, some days back he had a meeting with one Relationship Manager of HDFC bank regarding some investments. During their discussion he came to know that economic factors play very important role and economic factors can affect security price movement or return on investments. Amir Khan has a little knowledge about investment and impact of economy on investments. He has some spare fund and he wants to invest it but now he wants to know that how economic factors can play an important role? Explain him the factors and relation examples between economy factors and stock price with the help of examples.