Suppose the First National Bank acquires $500,000 in new deposits and the required reserve ratio is 12 percent. Which of the following is true?
a. Required reserves on the new deposits are $12,000.
b. Excess reserves on the new deposits are $500,000.
c. Required reserves on the new deposits are $60,000.
d. Excess reserves on the new deposits are $12,000.
e. Total reserves on the new deposits are $440,000.
c
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The demand for loanable funds curve shows the
A) positive relationship between the interest rate and the quantity of loanable funds demanded. B) positive relationship between the demand for loanable funds curve and the supply of loanable funds curve. C) U-shaped relationship between the interest rate and the quantity of loanable funds demanded. D) negative relationship between the interest rate and the quantity of loanable funds demanded. E) negative relationship between the demand for loanable funds curve and the supply of loanable funds curve.
The figure above shows the supply curve for a good with
A) a perfectly elastic supply. B) a perfectly inelastic supply. C) an elastic supply. D) an inelastic supply. E) a unit elastic supply.
Refer to Figure 3-7. Assume that the graphs in this figure represent the demand and supply curves for ramen noodles, an inferior good. Which panel describes what happens in this market as a result of an increase in income?
A) Panel (a) B) Panel (b) C) Panel (c) D) Panel (d)
The main reason(s) why governments sometimes chose to devalue their currencies is (are)
A) devaluation makes domestic goods more expensive in relation to foreign goods. B) devaluation makes domestic services more expensive in relation to foreign services. C) devaluation increases foreign reserves held by the central bank. D) devaluation improves the current account and increases foreign reserves held by the central bank. E) devaluation hurts foreign currencies.