Money Markets & Monetary Policy

86. The term “capital outflow” refers to:
a. The movement of financial assets from one country to another
b. The movement of financial assets from individuals to banks
c. The movement of financial assets from banks to the central bank
d. The movement of financial assets from the central bank to commercial banks

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87. The term “discount rate” refers to the rate at which:
a. Commercial banks lend to the central bank
b. The central bank lends to commercial banks
c. Commercial banks lend to each other in the money market
d. The government borrows from the central bank

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88. The term “securitization” refers to:
a. The process of converting financial assets into tradable securities
b. The process of issuing new shares in the stock market
c. The process of internationalizing a country’s currency
d. The process of issuing government bonds to finance fiscal deficits

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89. The term “systemic risk” refers to:
a. The risk of a widespread collapse of the financial system
b. The risk of default on a specific financial instrument
c. The risk of interest rate fluctuations in the money market
d. The risk of stock market volatility

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90. The term “capital injection” refers to:
a. The infusion of new capital into a financial institution to enhance its solvency
b. The withdrawal of capital from a financial institution due to poor performance
c. The redistribution of capital from one sector of the economy to another
d. The issuance of new shares by a company to raise funds

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