If the initial deposit into the banking system is $500 billion, and if the total $8,000 billion represents the maximum money supply permissible, then the legal reserve requirement must be
a. 8 percent
b. 6.25 percent
c. 11 percent
d. 12 percent
e. 12.3 percent
B
You might also like to view...
The payoff matrix below shows the daily profit for two firms, Row Restaurant and Column Cafe, for two different strategies, publishing coupons in the student paper and not publishing coupons in the student paper. 
The payoffs of this game are such that:
A. both firms would benefit from a law that made publishing coupons illegal. B. an agreement not to publish coupons would be easy to maintain because neither firm has an incentive to defect. C. profit at each firm is higher when they both follow their dominant strategy than when they both follow their dominated strategy. D. if Row Restaurant expects Column Cafe to choose its dominant strategy, then Row Restaurant should choose its dominated strategy.
In the above figure, the inflationary gap when AD2 is the aggregate demand curve equals
A) the difference between 110 and 100. B) the difference between $16.5 trillion and $16.0 trillion. C) LAS minus SAS at a price level of 100. D) AD1.
When the labor force is constant and unemployment is at its natural rate,
A) (the rate of job finding × the number of unemployed workers) = (the rate of job separation × the number of employed workers). B) (the rate of job finding × the number of employed workers) = (the rate of job separation × the number of unemployed workers). C) (the rate of job finding × the rate of job separation) = (the number of unemployed workers × the number of employed workers). D) (the rate of job finding + the rate of job separation) = (the number of unemployed workers + the number of employed workers).
Economist A. P. Lerner's idea that equality of income maximizes society's welfare is based on the assumption that
a. individuals have dissimilar utilities, but private property ownership distorts individual utilities so that no income distribution exists that reflects true utilities b. individuals are egalitarian c. individuals have identical utility functions d. individuals have identical skills e. individuals would voluntarily choose income equality