Assume that there are no excess reserves, no savings accounts, and no currency held by the public. If the demand deposit expansion multiplier is 4, the required reserve ratio must be
A) also 4.
B) .2.
C) .25.
D) .5.
C
You might also like to view...
?
Families are having more children than families did 15 years earlier. As a result, families have more trouble finding baby-sitters and are shocked at the cost of child care. Which graph in Figure 4-8 best illustrates how the situation has changed?
A. 1 B. 2 C. 3 D. 4
Which of the following factors would be most likely to encourage investment and capital formation in a less-developed nation?
a. High and variable rates of inflation. b. Tariffs and quotas that restrict international trade. c. A legal system that provides for secure property rights and evenhanded enforcement of contracts. d. High marginal tax rates.
Unless money can perform its job as a _______, it doesn't matter that much if it performs its other jobs that well.
Fill in the blank(s) with the appropriate word(s).
Contractionary fiscal policy is so named because it:
A. is expressly designed to contract real GDP. B. involves a contraction of the nation's money supply. C. necessarily reduces the size of government. D. is aimed at reducing aggregate demand and thus achieving price stability.