A bank currently has checkable deposits of $100,000 . total reserves of $30,000 . and loans of $70,000 . If the required reserve ratio is lowered from 20 percent to 15 percent, this bank can increase its loans by:
a. $10,000.
b. $15,000.
c. $75,000.
d. $5,000.
e. $0.
b
You might also like to view...
The federal budget has three components. Name them
What will be an ideal response?
Special-interest groups have little incentive to
a. earn profits b. redistribute wealth c. lobby Congress d. make the economy more efficient e. seek regulation beneficial to them
According to the Global Watch, a recent study on Chilean bus drivers revealed that drivers who are paid by the number of passengers rather than by the hour were far more productive because: a. bus drivers do not like to work that hard
b. bus drivers are responding to average costs. c. bus drivers don't like to work on the clockâgetting paid by the hour. d. bus drivers, like most of us, respond to incentives.
According to most economists, when can government debt lead to higher interest rates?
a. Always. b. Never. c. When government spends money wastefully. d. When misperceptions or default risks are significant.