If the interest rate falls, the opportunity cost of holding money __________ and the quantity demanded of money __________
A) rises, rises
B) rises, falls
C) falls, rises
D) falls, falls
C
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Assume that excess reserves are $10 million, demand deposits are $500 million, and total reserves are $135 million. The required reserve ratio is
A) .05. B) .1. C) .2. D) .25.
If demand is price inelastic,
a. price and total revenue change in opposite directions b. a seller should decrease the price to increase total revenue c. too few goods are being produced from society's point of view d. price and total revenue change in the same direction e. the market can never be in equilibrium
The rental price of capital is the:
A. equilibrium wage. B. interest paid on loans. C. amount producers pay to use a factor of production. D. value of the expected flow of income gained from ownership.
As a result of the open market sale, Jekyll Bank
A) can create $50,000 of new loans. B) will have $45,000 of excess reserves. C) will have to borrow reserves to replenish its reserve deficiency. D) will have an increase in checkable deposits.