Vault cash is equal to $8 million, deposits by depository institutions at the central bank are $2 million, the monetary base is $30 million, and bank deposits are $100 million. The money multiplier is equal to
A) 2.5.
B) 3.0.
C) 4.0.
D) 5.0.
C
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If firms are more pessimistic and believe that future profits will fall and remain weak for the next few years, then
A) investment spending will remain unaffected. B) investment spending will rise and then fall. C) investment spending will rise. D) investment spending will fall.
Fiscal policy is the use of government spending and taxation to make changes in the level of national income
Indicate whether the statement is true or false
Banks create money by keeping a small percentage of deposits in reserves and __________ the remaining funds, charging interest.
a. lending b. spending c. saving d. investing
Women earn less on average than men. Which of the following would be the logical conclusion?
a. Women must be the victim of employment discrimination. b. Women must be less productive. c. Men must be more highly motivated and materialistic. d. Without consideration of preferences and productivity factors, differences in unadjusted mean earnings do not necessarily reflect employment discrimination.