Why is it easier for the Fed to manage the level of bank reserves using the term auction facility (TAF) as opposed to using discount window lending?
A) Banks do not need to overcome the stigma of requesting a loan when using the TAF.
B) Banks receive TAF proceeds on a 3-day delay, rather than on the day they are requested.
C) Banks that use seasonal credit are more likely to use the term auction facility.
D) Banks receive TAF proceeds after a lengthy verification process.
Correct Answer:
Verified
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