If the reserve ratio is 12.5 percent, then $5,600 of money can be generated by
a. $64 of new reserves.
b. $448 of new reserves.
c. $700 of new reserves.
d. $800 of new reserves.
c
You might also like to view...
In the early 2000s, lenders began issuing mortgage loans to people who would normally not be qualified to take out loans because they did not meet lending standards. Those borrowers are known as
A) alternative borrowers. B) weak borrowers. C) subprime borrowers. D) credit risks.
If a central bank engages in an unsterilized foreign-exchange intervention with the intention of raising the foreign-exchange value of its currency,
A) the central bank's holdings of international reserves will fall. B) the domestic money supply will rise. C) domestic interest rates will fall. D) it will buy foreign assets.
The concept of equity pertains to the fairness of a tax.
Answer the following statement true (T) or false (F)
Individuals with higher saving and investment rates will more likely
A) earn poverty level incomes. B) experience financial difficulties. C) have higher current consumption rates. D) have higher incomes in the future.