For the following question, assume the following facts:
(1 ) Chase (which is located in the United States) has a 20% reserve requirement imposed by the government.
(2 ) Bank of Germany has no reserve requirements.
(3 ) Both banks may invest at an 8% interest rate.
(4 ) Both banks have fixed costs of $3 per deposit made.
What is the difference between the minimum interest rates each bank can offer and still make a profit if the deposit is $500 for 1 year?
A) 0 - Both banks can offer the same rate.
B) 1%
C) 1.6%
D) 0.4%
E) 20%
C
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Given the information in the figure above, Liz has a comparative advantage in ________ because ________
A) smoothies; her opportunity cost of producing smoothies is lower than Joe's B) salads; her opportunity cost of producing salads is lower than Joe's C) smoothies; she can produce more smoothies per hour than Joe can D) salads; she can produce more salads per hour than Joe can E) both goods; she can produce more of both goods per hour than Joe can
When the price level rises as a result of a decrease in aggregate supply, it is called cost-push inflation
a. True b. False Indicate whether the statement is true or false
Historically, firms charged with monopolizing their markets often successfully argue in court that
a. a high price is not necessarily harmful to the economy b. too much competition is cutthroat c. the relevant market should be more broadly defined d. the government has no right to interfere in markets e. their good's cross elasticity of demand is negative
If Honda (a Japan-based firm) produces a car in Ohio and exports it to Japan, in which country's GDP will the car be counted?
a. Japan's, because Honda is a Japanese company b. Japan's because that is where the car is purchased c. The GDP of the United States because that is where it was built d. Both Japan and the United States