Say the required reserve ratio is 10 percent. If you pay back a loan of $20,000 a bank had previously made to you, the act of paying back the loan:
a. adds $2,000 in bank reserves
b. adds $20,000 in bank reserves.
c. eliminates $2,000 in bank reserves.
d. eliminates $20,000 in bank reserves.
b
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The government sets a price floor for corn which is above the equilibrium price of corn. As a result, ________
A) the corn market will be efficient B) a deadweight loss will be created C) a shortage of corn will be created D) none of the above answers is correct
Which of the following ensures full employment in the Classical model?
A) Wage and price flexibility B) The equation of exchange C) Inventory adjustment D) Constant velocity
For a perfectly competitive firm with a known marginal cost and random demand, as the expected marginal revenue increases, the profit-maximizing quantity ________.
A) approaches zero B) increases C) does not change D) decreases
As a percentage of nonfarm workers, union membership in the United States grew most rapidly since 1945
a. True b. False Indicate whether the statement is true or false