A reserve requirement set by the Federal Reserve is the:
A. minimum amount of currency banks must hold in their vaults.
B. maximum amount of currency banks are allowed to hold in their vaults.
C. minimum ratio of reserves to bank deposits that commercial banks are allowed to maintain.
D. maximum ratio of reserves to bank deposits that commercial banks are allowed to maintain.
Answer: C
You might also like to view...
In the short run, an increase in aggregate demand
A) lowers the price level and decreases real GDP. B) lowers the price level and increases real GDP. C) raises the price level and increases real GDP. D) raises the price level and decreases real GDP.
The process of bargaining for a large group of workers at one time rather than individually is known as ________
A) collective bargaining B) autarky C) tertiary negotiations D) ornamental horticulture
Suppose the cost of flying a 200-seat plane for an airline is $100,000 and there are 10 empty seats on a flight. If the marginal cost of flying a passenger is $200 and a standby passenger is willing to pay $300, the airline should
a. sell the ticket because the marginal benefit exceeds the marginal cost. b. sell the ticket because the marginal benefit exceeds the average cost. c. not sell the ticket because the marginal benefit is less than the marginal cost. d. not sell the ticket because the marginal benefit is less than the average cost.
Assume leisure is an inferior good instead of a normal good. The income effect of a wage increase will lead to a ________ demand for leisure and a ________ labor supply.
A. higher; higher B. lower; higher C. higher; lower D. lower; lower