Answered

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You are the manager of a local bank. Due to unstable financial conditions, savers are worried that your bank may fail. When they show up in large numbers to withdraw their savings, you find that you do not have enough cash to meet the obligations. Where can you turn for a loan if no other bank will lend to you? The stock market The bond markets The discount window The market for overnight loans

Sagot :

Answer:

The discount window

Explanation:

As we can see that there is a liquidity problem for the bank as it has not enough funds to payoff back to the depositors. Also No other bank is ready to lend.

The discount window would be the monetary policy instrument that controlled by the central bank in which it permits the institutions that they are eligible for borrow the money so that they could meet their shortage and this money would be lend for short term duration by the central bank

Therefore it is a discount window

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