Problem
1. If the Fed wishes to discourage banks from borrowing at the discount window except in emergencies, why does it keep the discount rate below the Federal funds rate?
2. Why does the Fed feel the need to maintain a system of reserve ratios when the Bank of England does not (apart from the small prudential ratio)?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.