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Selective credit controls give a central bank power over which two things?
AReserve requirements and the discount rate on loans
BConsumer credit rules and margin requirements
CDeposit insurance premiums and bank charters
DBond purchases and the printing of new currency
Answer & Solution
Correct answer: B. Consumer credit rules and margin requirements
1. Selective credit controls are the power to control the credit terms on some loans made by banks and other lending institutions.
2. That power covers consumer credit rules and margin requirements.
3. Reserve requirements and the discount rate are money supply tools, which is a separate group.
4. Deposit insurance premiums are set by the insurer, so they fall outside credit control altogether.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 15 "Understanding Money and Financial Institutions", section 15.2 The Federal Reserve System_
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