Banks That Need Additional Funds to Meet the Reserve Requirements

Multiple Choice

Banks that need additional funds to meet the reserve requirements of the Federal Reserve:

A) borrow from the state government of the state where their headquarters are located.
B) borrow from banks with excess reserves.
C) issue treasury bills to investors.
D) decrease the coupon interest rate on the bonds issued to raise funds.
E) exercise the call option on the loans extended to small businesses.