A commercial bank has excess reserves of $10,000 and a required reserve ratio of 20%. It grants a loan of $8,000 to a customer, who then writes out a check for $8,000 that is deposited in another bank. The first bank will find its reserves decrease by
A. $8,000.
B. $1,600.
C. $3,000.
D. $2,000.
Answer: A
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The formula for the slope across an arc is used to approximate the slope for
A) linear relationships only. B) a curved line. C) a positive relationship only. D) a negative relationship only.
The table above shows how the number of books Katie buys each year depends on her income
a) What kind of relationship exists between Katie's income and the number of books she purchases? b) Plot the relationship between Katie's income and the number of books she purchases in the above figure. Measure income along the vertical axis and the number of books along the horizontal axis. Be sure to label the axes. c) What is the slope of the relationship between $50,000 and $70,000 of income? d) What is the slope of the relationship between $90,000 and $110,000 of income? e) Comment on the similarity or dissimilarity of your answers to parts (c) and (d).
If the minimum wage is set above the market wage
A) unemployment will rise. B) the quantity of labor supplied will be below the quantity of labor demanded. C) highly-skilled workers will have a harder time finding jobs. D) All of the above are correct.
Which of the following would likely be involved in a new bond offering?
A) a commercial bank B) an investment bank C) a broker D) a dealer