8. When the Fed provides funds to troubled banks that cannot find any other sources of…

8. When the Fed provides funds to troubled banks that cannot find any other sources of funds, it is acting as O A. the lender of last resort. OB. the bureau de change. O c. the Federal Deposit Insurance Corporation. OD. the interbank clearinghouse. 9. Suppose in the Republic of Sasquatch that the regulation of banking rested with the Sasquatchian Congress, including the determination of the reserve ratio. The Central Bank of Sasquatch is charged with regulating the money supply by using open market operations. In September 2015, the money supply was estimated to be 70 million yetis. At the same time, bank reserves were 8.4 million yetis and the reserve requirement was 12 percent. The banking industry, being “loaned up,” lobbied the Congress to cut the reserve ratio. The Congress yielded and cut the reserve requirement to 10 percent. million yetis. The potential impact of this action could (1) – the money supply by (Round your response to one decimal place.) Suppose the central bank decided that the money supply should not be increased. What countermeasure could it take to prevent the Congress from expanding the money supply? O A. Raise the discount rate to prevent the expansion of the money supply. OB. Lower the discount rate to prevent the expansion of the money supply. O c. Buy government securities to prevent the expansion of the money supply. OD. Increase regulations to prevent the expansion of the money supply. (1) O decrease O increase 10. The economy is beginning to slip into a recession. Further, data indicate that inflation is low. The Fed will most likely respond to this state of the economy by O A. purchasing government securities to lower the interest rate. OB. selling government securities to raise the interest rate. O c. selling government securities to lower the interest rate. OD. purchasing government securities to raise the interest rate.