The principle of fractional reserve banking makes it possible for a
A) bank to make loans.
B) bank to print currency.
C) bank to avoid reserve requirements.
D) bank to sell securities.
Answer: A) bank to make loans.
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The New Deal
A. may be summarized by these words: relief, recovery, and reform. B. introduced Medicare and Medicaid. C. succeeded in quickly extending the Great Depression. D. reduced the economic role of the federal government.
The market in which banks borrow from other banks for short periods of time is the
a. discount market b. federal funds market c. interbank loan market d. national bank market e. liquidity market
In Okunland, a country whose economy operates according to Okun's law, real GDP equals $7,520 billion, potential GDP equals $8,000 billion, and the actual unemployment rate is 8 percent. What is the natural rate of unemployment in Okunland?
A. 2 percent B. 11 percent C. 6 percent D. 5 percent
Mitchell's money income is $150, the price of X is $2, and the price of Y is $2. Given these prices and income, Mitchell buys 50 units of X and 25 units of Y. Call this combination of X and Y bundle J. At bundle J, Mitchell's MRS is 2. Given these prices and income, what is Mitchell's equilibrium consumption of X?
A. X = 50 B. X > 50 C. X < 50 D. None of the statements is correct.