An important effect of fractional reserve banking is that:
a. bankers' choices about how much to lend can affect the money supply
b. the commercial banking system has complete control over total reserves.
c. bankers always turn every dollar of excess reserves into loans.
d. a new bank deposit allows a bank to extend loans of the same amount to borrowers.
a
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According to the Economic Freedom Index,
A) countries with the lowest economic freedom enjoyed the highest per capita GDP. B) countries with the highest economic freedom enjoyed the lowest per capita GDP. C) countries with the highest economic freedom enjoyed the highest per capita GDP. D) there is no relationship between economic freedom and per capita GDP.
An increase in the marginal physical product of capital increases the demand for loanable funds
Indicate whether the statement is true or false
Inflation ________ the purchasing power of money.
A. increases B. does not affect C. stabilizes D. decreases
Refer to the given information. If nominal GDP is $300 and the supply of money is $230, the equilibrium interest rate will be:
Answer the question on the basis of the following information. For transactions, households
and businesses want to hold an amount of money equal to one-half of nominal GDP. The table
shows the amounts of money they want to hold as an asset at various interest rates.
A. 8 percent.
B. 6 percent.
C. 4 percent.
D. 2 percent.