Banks can continue to make loans until their
A) actual reserves equal their excess reserves.
B) excess reserves equal their required reserves.
C) actual reserves equal their required reserves.
D) actual reserves equal their checking account balances.
C
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Suppose you have $400 to invest at a nominal interest rate of 7 percent, and the investment's term to maturity is 1 year. If the inflation rate is 2 percent, then the real return on your investment is approximately
A) $8. B) $20. C) $28. D) $36.
When monetary policies result in a worsening of economic performance, the least likely explanation is ________
A) a political business cycle B) changes in one or more key structural parameters of the economy C) a policy-induced change in the expectations and behaviors of households and businesses D) faulty interpretation of incomplete and ambiguous economic data
In a situation in which property rights are not well-defined and social costs exceed private costs, government can use all of the following to induce producers to bring private costs into alignment with social costs EXCEPT
A. regulation of production. B. taxing production. C. coercive limits on production. D. subsidization of production.
Having a government agency certify bond rating agencies may not be desirable
Indicate whether the statement is true or false