Suppose a transaction changes a bank's balance sheet as indicated in the following T-account, and the required reserve ratio is 10 percent
Assets Liabilities
Reserves + $2,000 Deposits + $2,000
As a result of the transaction, the bank can make a maximum loan of
A) $0.
B) $200.
C) $1,800.
D) $2,000.
Answer: C
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If the rate of job separation equals 2%, and the natural rate of unemployment is 10%, then the rate of job finding equals
A) 5%. B) 16.7%. C) 18%. D) 20%.
If a consumer purchases only two goods (x and y) and the demand for x is elastic, then a rise in the price of x:
a. will cause total spending on good y to rise. b. will cause total spending on good y to fall. c. will cause total spending on good y to remain unchanged. d. will have an indeterminate effect on total spending on good y.
Many states have usury laws, which:
a. impose an upper limit on the interest rate that lenders can charge. b. impose a lower limit on the interest rate that lenders can charge. c. impose limits on how products can be used by consumers. d. impose an upper limit on the quantity of a product that can be sold.
As the number of sellers in an oligopoly becomes very large,
a. the quantity of output approaches the socially efficient quantity. b. the price approaches marginal cost. c. the price effect is diminished. d. All of the above are correct.