Assuming a reserve ratio of 25 percent, if a bank receives $100,000 in deposits how much can the bank loan out?
A. $100,000
B. $400,000
C. $25,000
D. $75,000
Answer: D
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If the interest rate is above the equilibrium interest rate, then
A) there is an excess demand for money. B) the quantity of money demanded exceeds the quantity supplied. C) people will sell bonds and the interest rate will fall. D) people will buy bonds and the interest rate will fall.
The fact that there are too few resources to satisfy all our wants is attributed to
A. Greed. B. Lack of money. C. Shortages. D. Scarcity.
Refer to the diagram. Between prices of $5.70 and $6.30:
A. D 1 is more elastic than D 2 .
B. D 2 is an inferior good and D 1 is a normal good.
C. D 1 and D 2 have identical elasticities.
D. D 2 is more elastic than D 1 .
In the national income accounts, the purchase of a new house counts as
A) consumption expenditure. B) investment. C) a transfer. D) an addition to inventory.