Assume that excess reserves are $35 million, demand deposits are $500 million, and total reserves are $135 million. The required reserve ratio is
A) .07.
B) .2.
C) .25.
D) .27.
D
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A firm operating with diminishing total returns cannot be profit maximizing
What will be an ideal response?
Which of the following statements is true of open-market operations?
a. Open-market operations involve clearing checks b. Open-market operations involve lending money to member banks. c. Open-market operations involve accepting deposits from member banks. d. Open-market operations involve the Fed's purchase and sale of government securities. e. Open-market operations involve the Fed's purchase and sale of foreign exchange.
If the domestic income of a nation’s citizens increase thus causing consumption spending to increase, then we generally expect net export spending to:
A. increase as well because as consumption increases we also buy more foreign goods and services. B. decrease as well because as consumption increases we also buy more foreign goods and services. C. remain constant because when we increase domestic purchases it is directly offset by a reduction in foreign purchases. D. there is not enough information to determine what would happen.
International trade allows countries to:
a. produce outside their PPF. b. produce inside their PPF. c. consume inside their PPF. d. consume outside their PPF.