Assuming all excess reserves are loaned out, currency holdings by the public are zero, and a reserve ratio of 5 percent, an initial deposit of $10,000 will lead to a total increase in deposits of:
A. $500.
B. $10,000.
C. $50,000.
D. $200,000.
Answer: D
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When a nation exports a good or service in which it has a comparative advantage, employment in that industry
A) decreases. B) stays the same. C) increases. D) might change, but more information about what else the country exports is needed to determine if employment increases, decreases, or does not change. E) might change, but more information about what the country imports is needed to determine if employment increases, decreases, or does not change.
The logic of the double-dividend hypothesis may not hold because the Pigouvian tax exacerbates pre-existing distortions in the labor market.
A. True B. False C. Uncertain
People of Moifo, a small island country, use oranges in exchange for various goods and services. If all the oranges are of uniform quality, which of the following is likely to cause a collapse of the orange currency in Moifo? a. Oranges cannot serve as a medium of exchange. b. Oranges cannot serve as a unit of account
c. Oranges cannot store value. d. Oranges are not grown in the territory of Moifo.
Reese has recently left her teaching job to open a bakery. The ______ is an example of the implicit costs of her bakery business.
a. rent she pays for the commercial space b. teaching salary she gave up to start her bakery c. monthly payments she makes for bakery equipment d. wages she pays her counter assistant