If the money stock is $900 million and the reserve requirement is 20%, what is the monetary base?
A) $180 million
B) $4,500 million
C) $720 million
D) The monetary base cannot be determined with the information given.
A
You might also like to view...
Which of the following is an unit excise tax?
A. A tax of 15% B. An admission fee of $2.00 on each ticket purchased C. An ad valorem tax of $3.00 D. An income tax of $3.00
Answer the following statements true (T) or false (F)
1. A considerable degree of government control of production and distribution exists in a command economy. 2. The profit motive is one characteristic of a command economy. 3. Competition serves as a regulator in a market economy. 4. In a market economy, prices serve as a rationing mechanism.
The interest rate charged on overnight loans of reserves between banks is the
A) prime rate. B) discount rate. C) federal funds rate. D) Treasury bill rate.
Which of the following is NOT an argument of non-activists?
A) private spending may show some instability but monetary or fiscal policy designed to stabilize it will just make things worse B) private spending is stable partly because consumption spending is based on permanent income C) even if prices are not completely flexible in the short-run, given time there is enough flexibility for the system to return to the natural level of real GNP D) it is true that monetary and fiscal policy have destabilizing in the past, but economic knowledge is now advanced enough to permit effective countercyclical policy