When a bank grants a loan to a customer who then keeps the funds in her checking account at that bank, then the bank's:
A. Actual reserves will increase
B. Required reserves will increase
C. Actual reserves will decrease
D. Excess reserves will stay the same
B. Required reserves will increase
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"Sharp contractions in a country's output and employment invariably result from a crisis in which the country suddenly loses access to all foreign sources of funds." Explain how the current account identity necessitates these contractions
What will be an ideal response?
An oligopoly is a market in which at least some firms are large enough to influence market price
a. True b. False Indicate whether the statement is true or false
If the velocity of circulation is 10 and the money supply is $250, the value of transactions will be $25
a. True b. False Indicate whether the statement is true or false
Due to free entry and exit in monopolistic competition, in the long run price must be equal to