Refer to the given data. If the Fed increased the reserve requirement from 20 percent to 25 percent, a deficiency of reserves in the commercial banking system of _____ would occur and the monetary multiplier would fall to ____.
Answer the question on the basis of the following consolidated balance sheet of the commercial banking system. Assume that the reserve requirement is 20 percent. All figures are in billions and each question should be answered independently of changes specified in all preceding ones.
A. $50 billion; 5
B. $10 billion; 4
C. $50 billion; 4
D. $10 billion; 8
C. $50 billion; 4
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If the current account has a negative balance of $100 and the capital and financial account has a positive balance of $80, there will be ________ in official reserves of ________
A) a decrease; $20 B) an increase; $20 C) an increase; $180 D) a decrease; $180
Demand curves often do not remain stationary; they shift because of changes in other variables.
Answer the following statement true (T) or false (F)
A firm is more likely to produce its own input if all of the following are true except which one?
A) The firm has trade secrets. B) The firm is concerned about the hold-up problem. C) The firm experiences diseconomies of scale when producing the input. D) The transportation cost of the input is expensive.
When we say that money is fungible, we mean that a dollar spent out of your savings account:
A. is exactly the same as a dollar spent from your checking account. B. is earmarked for a purpose and can't be spent on everyday expenses like groceries. C. is not substitutable with any other dollar you have. D. is worth more than the dollar you have in your pocket.