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The Federal Reserve acts as a bank's: 1- depositor 2- champion 3- bank 4- borrower During...

The Federal Reserve acts as a bank's:

1- depositor

2- champion

3- bank

4- borrower

During the Credit Crisis, the Federal Reserve engaged in all of the following actions, except:

1- purchasing stock

2- purchased government bonds

3- purchasing US government securities

4- lowered interest rates

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Answer #1

Answer 1 : 3 : bank

It is one of the functions of Federal reserve. Whenever an bank requires money, they can ask from Federal reserve and that's why it is known as bank's bank.

Answer 2 : 1 : purchasing stock

Federal reserve is not involved in buying any kind of stocks. It is engaged in issuing and repurchasing Government bonds and US Government securities.

Secondly, To make liquidity available in market, rate of interest is lowered during credit crisis, like recent case of coronavirus.

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