The multiple by which the commercial banking system can increase the supply of money on the basis of each dollar of excess reserves is equal to:
A. the reciprocal of the legal reserve ratio.
B. the reciprocal of the velocity of money.
C. 1 minus the legal reserve ratio.
D. marginal propensity to save.
Answer: A
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The World Bank
A) extends long-term loans for capital investment projects to developing nations. B) mediates contracts regarding minimum prices for various globally-traded commodities. C) determines the labor force participation rate in each of its member nations. D) determines the price level in each of its member nations.
International data suggests that countries with different steady states will
a. converge to the same growth rates of output. b. converge to the same per-capita output levels. c. not converge. d. converge to the same steady state in the long-run.
An important assumption that is made when constructing a demand schedule is that
a. only price and quantity matter in determining demand. b. people always want a certain amount of a product. c. demand is too important to be left to the economists. d. all other determinants of demand are held constant. e. demand has a positive slope.
If the dollar depreciates against the yen, U.S. goods sold in ________ would become less expensive and Japanese goods sold in ________ would become more expensive.
A. the United States; the United States B. the United States; Japan C. Japan; Japan D. Japan; the United States