If the reserve requirement is 5 percent, a bank desires to hold no excess reserves, and it receives a new deposit of $10, then this bank
a. must increase its required reserves by $10.
b. will initially see its total reserves increase by $10.50.
c. will be able to make new loans up to a maximum of $9.50.
d. All of the above are correct.
c
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The opportunity cost of going to college might best be described as
A) the money that must be paid in order to attend college. B) the lowest—valued alternative use of the student’s time. C) the highest—valued alternative use of the student’s time. D) the value that the student attaches to not working.
When interest rates fall, people will be willing to hold more money.
a. true b. false
The Federal Open Market Committee makes decisions about ________ policy.
A. monetary B. banking C. deposit insurance D. fiscal
?A short-run aggregate supply curve (SRAS) assumes:
A. ?the CPI is fixed. B. ?each point on the SRAS is potential real GDP. C. fixed or sticky nominal wages. D. ?nominal wages vary directly with price changes.