Multiple Choice
Assume that the Federal Reserve sets a required reserve ratio of 10%. If a bank receives a deposit of $1000, then
A) it must keep $10 on reserve and can loan out $990.
B) it must keep $100 on reserve and can loan out $900.
C) it must keep $1000 on reserve and cannot make any loans.
D) it must keep $900 on reserve and can loan out $100.
Correct Answer:
Verified
Correct Answer:
Verified
Q6: The availability of credit makes an economy
Q7: What is the wealth effect?<br>A) The tendency
Q8: Why consumers tend to purchase less if
Q9: How do banks create money?<br>A) Banks print
Q10: Assume that the Federal Reserve sets a
Q11: What is the prime rate?<br>A) It is
Q13: Brad and Angie own a nice house
Q14: Assume that Sam has $2000 in savings
Q15: Assume that the Federal Reserve sets a
Q16: Assume that the Federal Reserve sets a