The maximum amount of increase in the money supply that can be caused by an increase in excess reserves is equal to the
A) deposit multiplier ´ the required reserve ratio.
B) loan multiplier ´ the change in excess reserves.
C) deposit multiplier ÷ the change in excess reserves.
D) deposit multiplier ´ the change in excess reserves.
Ans: D) deposit multiplier ´ the change in excess reserves.
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Inflation ________
A) is more costly when it is anticipated than when it comes as a surprise B) makes it more difficult to plan for the future, whether it is a surprise or not C) induces distortions in the money and goods market but not the labor market D) all of the above E) none of the above
Personal consumption expenditures is the smallest component of total spending
a. True b. False Indicate whether the statement is true or false
One point virtually all economists agree on when defining money is that: a. money must be spendable
b. money must be liquid. c. money must be accepted as payment. d. all of the above are correct.
Economic time series are outcomes of random variables.
Answer the following statement true (T) or false (F)