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In General,the Discount Rate Is Kept Close to Short-Term Market

Question 62

Multiple Choice

In general,the discount rate is kept close to short-term market interest rates to


A) enable commercial banks to operate profitably.
B) reduce the government cost to borrow money.
C) discourage commercial banks from excessive use of the borrowing privilege.
D) avoid the possibility that monetary actions affect financial market expectations.
E) keep interest rates stable over long periods of time.

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