The Intracoastal Bank has $5 million in deposits and $500,000 in reserves. If the required reserve ratio is 5%, excess reserves are equal to
A. zero.
B. $125,000.
C. $250,000.
D. $500,000.
Answer: C
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A monopolist will always end up choosing to operate
a. even if its profits are negative. b. on the elastic portion of its demand curve. c. until such time as a new competitor enters its market. d. only if it can capture the entire consumer surplus.
When an economy faces diminishing returns,
A) the slope of the per-worker production function becomes flatter as capital per hour worked increases. B) the per-worker production function shifts to the left. C) the per-worker production function shifts to the right. D) the slope of the per-worker production function becomes steeper as capital per hour worked increases.
As the interest rate falls, the quantity supplied of money falls and the quantity demanded of money rises
Indicate whether the statement is true or false
If firms in a monopolistically competitive market are earning economic profits greater than zero in the short run, then in the long run:
A. firms will exit this market. B. profits will increase. C. profits will decrease. D. demand will not change.