Financial Sector

Banks are forced to close due to lack of funds

Banks can loan less money, decreasing the money supply

The money multiplier decreases

Banks can loan out more money, which can increase the money supply

Issuing credit cards to clients

Granting a mortgage loan.

Receiving deposits from customers

Making long-term investments

By converting foreign currencies into domestic currency only.

By holding all customer deposits as reserves without lending them out.

By charging high-interest rates on savings accounts held by customers.

By lending out a portion of deposited funds while retaining some reserves.

Open market operations.

Fiscal policy adjustments.

Wage-price controls.

Import-export regulations.

An annual event organized by banks for charity

A regular daily operation where banks exchange money

A situation where many customers withdraw their deposits simultaneously, fearing the bank may become insolvent

The physical transfer of cash from the central bank to commercial banks

They generate new money by making loans.

They set interest rates for federal bonds.

They collect taxes on behalf of the government.

They print paper currency and mint coins.

By printing physical currency

By minting coins

By lending money

By charging fees for services

Net exports will decline as consumers spend more on domestic and imported goods, leading to a deteriorating current account balance.

Net exports increase since a higher level of savings resulting from increased consumer confidence boosts capital outflows.

Net exports remain unchanged as increased consumer demand is typically matched by supply without affecting trade dynamics.

The current account improves due to a greater inclination for consumers to purchase locally produced items over imports.

Modifying tax policies

Regulating stock exchanges

Changing reserve requirements

Enforcing trade tariffs

No change to the current account as depreciation is offset by an increased debt service burden on foreign-denominated debt.

An immediate stabilization of the balance of payments as the market quickly self-corrects through automatic mechanisms.

A gradual improvement in trade balance as exports increase while imports decrease due to price changes.

Persistent trade deficits despite depreciated currency due to domestic companies' inability to increase production.