19.03.2023 - 23:43

The most common type of discount lending that the Fed extends to banks is called: s) seasonal credit. b) secondary credit. c) primary credit. d) installment credit.

Question:

The most common type of discount lending that the Fed extends to banks is called:

s) seasonal credit.

b) secondary credit.

c) primary credit.

d) installment credit.

Answers (1)
  • Allene
    April 18, 2023 в 23:56
    The correct answer is (a) seasonal credit. Seasonal credit is a type of discount lending that the Federal Reserve extends to banks. This type of credit is offered to banks in order to help them meet seasonal fluctuations in their demand for funds. For example, if a bank experiences an increase in demand for loans during the holiday season, they may need to borrow additional funds to meet the demand. The Fed offers seasonal credit to help banks manage these seasonal fluctuations in their demand for funds. This type of credit is typically offered at a higher interest rate than other forms of discount lending, and is generally only available to well-established, financially sound banks.
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