When reserve requirements are increased, the:
a. excess reserves of commercial banks will decrease.
b. excess reserves of commercial banks will increase.
c. U.S. Treasury will have to borrow additional funds.
d. money supply will rise.
a
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Explain the economic concept of price elasticity of supply. How is price elasticity of supply calculated?
What will be an ideal response?
The HO model rules out the classical model's basis for trade by assuming that ________ is (are) identical between countries
A) factor endowments B) factor intensities C) technology D) opportunity costs
A conclusion of the classical macroeconomic model is that
A. the average price level is determined by the costs of production. B. the average price level is determined strictly by the money supply. C. changes in interest rates cause changes in the velocity of money. D. sustained unemployment is unavoidable in a market economy.
In the production possibilities frontier model, an unattainable point lies
A) both on and outside the production possibilities frontier. B) only outside the production possibilities frontier. C) only inside the production possibilities frontier. D) only on the production possibilities frontier itself. E) There are no unattainable points in the production possibilities model.