If reserves in the banking system increase by $200, then checkable deposits will increase by $500 in the simple model of deposit creation when the required reserve ratio is
A) 0.04.
B) 0.25.
C) 0.40.
D) 0.50.
C
You might also like to view...
The Heckscher-Ohlin model predicts all of the following EXCEPT
A) the volume of trade. B) which country will export which product. C) which factor of production within each country will gain from trade. D) that relative wages will tend to become equal in both trading countries. E) that trade increases a country's overall welfare.
A college student decides to spend the afternoon watching three movies rented from Red Box. The cost of each movie is $1. The student was willing to pay $4 to rent each of the first two movies and $2 to rent the third movie. What was the marginal benefit received by the student when renting the 3rd movie?
A. $1 B. $8 C. $4 D. $2
According to the theory of rational expectations,
a. workers' experience tells them that government action to lower unemployment will not affect inflation. b. consumers and investors generally behave so that rationally formed government attempts to stimulate aggregate demand have their desired effects. c. policy goals can be achieved easily in the short run. d. workers' wage demands include anticipated inflation. e. expansionary monetary policy will lead to permanent interest rate declines.
A single-price monopoly with the same market demand and cost structure as a perfectly competitive market will produce
a. the same output level at the same price as the perfectly competitive market b. less because the monopolist will not produce all units for which marginal revenue exceeds its marginal cost c. less since the monopolist's marginal revenue curve lies below its demand curve d. more because the monopolist will be more efficient e. more because the monopolist's marginal cost curve slopes upward