MACROECONOMICS+ACHIEVE 1-TERM AC (LL)
10th Edition
ISBN: 9781319467203
Author: Mankiw
Publisher: MAC HIGHER
expand_more
expand_more
format_list_bulleted
Question
Chapter 18, Problem 6QQ
To determine
The lender of last resort.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
The FDIC
The reserve ratio is the fraction of deposits that banks
a.Hold in order to maintain the nation’s gold standard
b.Invest in securities
c.Hold as reserves
d.Have loaned to borrowers
e.Are required by law to loan to borrowers
Which type of bank is responsible for supervising a country's bank system
A Commercial bank
A central bank
An investment bank
Option A and C
Chapter 18 Solutions
MACROECONOMICS+ACHIEVE 1-TERM AC (LL)
Knowledge Booster
Similar questions
- A bank is an entity that A) qualifies for FDIC deposit insurance B c) accepts demand deposits D all these answers are correct E makes business loans channels funds from savers to borrowers.arrow_forwardBank managers lend the excess reserves created when new deposits come in because they want to a. create new money in the economy. b. earn a profit. c. deplete required reserves. d. deplete desired reserves.arrow_forwardThe ease at which an asset can be converted into a medium of exchange is known as A. Inflation B. Profitability C. Liquidity D. Wealtharrow_forward
- Banks want to hold as little cash as possible because holding cash a. provides very little liquidity. b. offers a minimal rate of return. c. is risky. d. provides too much liquidity.arrow_forwardRequired reserves of banks are a fixed percentage of their a. deposits. b. All of these responses are correct. c. loans. d. assets.arrow_forwardThe Bank of Canada sets the reserve requirement, which banks must meet through deposits at the Bank of Canada and cash held at the bank. What do these requirements achieve? Check all that apply. They help to facilitate transfers of funds between banks when a customer from one bank writes a cheque to a customer of another. They help to control the money supply. They help to prevent bank runs by reassuring the public that banks will not make too many loans and run out of cash. They mean that a bank must have one dollar of deposits for every dollar it lends.arrow_forward
- How study in economic would benefit the central bank and nation.arrow_forwardThe federal deposit insurance corporation(FDIC) does which 3 things? a. Directly manges every bank in the unitwd states b. Performs tests on banks to see if they are prepared for emergencies c. Takes over failing banks and sells them to better managed banks d. uses tax payer money to help out struggling banks e. Insures deposits in every bank account up to $250,000arrow_forwardA bank can make profit by: a)borrowing money from the government at 0% interest. b)giving you a particular interest return on your savings and then loaning out the same money at a lower rate of interest. c)giving you a particular interest return on your savings and then loaning out the same money at a higher rate of interest. d)storing and locking away all the deposits made by consumers.arrow_forward
- A bank that wishes to reduce its credit risk could: A. Sell risky loans from its loan portfolio B. Enter into a repurchase agreement O. Buy a credit default swap D. Sell a credit default swap E. Both A and C will reduce credit riskarrow_forwardHow does the Central Bank spend it's profit?arrow_forwardA bank's reserves include its Multiple Choice vault cash and deposits with the Federal Reserve. holdings of government bonds and corporate stocks. checkable deposits and holdings of government bonds. tellers who are ready and able to work if there is a strike by the regular tellers.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Economics Today and Tomorrow, Student EditionEconomicsISBN:9780078747663Author:McGraw-HillPublisher:Glencoe/McGraw-Hill School Pub Co
Economics Today and Tomorrow, Student Edition
Economics
ISBN:9780078747663
Author:McGraw-Hill
Publisher:Glencoe/McGraw-Hill School Pub Co