With fewer depository institutions in debt to the Federal Reserve banks, there will be a tendency for depository institutions to decrease their lending activities.

Question

Quizplus · Accepted Answer

Fewer depository institutions in debt to the Federal Reserve banks would typically indicate a healthier banking sector, which could lead to an increase in lending activities as banks are more financially stable and have more capital available to lend.

With Fewer Depository Institutions in Debt to the Federal Reserve