1- A bank has excess reserves of $10,500 and demand deposit liabilities of $30,000. If the required reserve ratio is 0.15, then the money multiplier (m) is

less than 1

greater than 1

exactly 1

We cannot tell without more information

2- When the nominal interest rate is zero, the rise in expected inflation will lead to a _______in the real interest rate, which will cause investment spending and aggregate output to _______.

fall; fall

rise; rise

rise; fall

fall; rise

3- In the simple deposit expansion model, if the banking system has excess reserves of $25, and the required reserve ratio is 0.2, the potential expansion of checkable deposits is

a$50.b- $10.c- $250d-.$500.