Question
1. Assume all money is held as demand deposits and the required reserve ratio is 8%. Also assume that banks will expand loans and deposits
1. Assume all money is held as demand deposits and the required reserve ratio is 8%. Also assume that banks will expand loans and deposits until the excess reserves are zero. What will be the increase in money supply for a $10 million increase in the reserves? [Hint: REQ = 0.08]
| A. | $80 million | |
| B. | $90 million | |
| C. | $120 million | |
| D. | $125 million |
2. Which one of the following will be considered to be monetary easing?
| A. | Raising the interest rate charged for loans at the discount window. | |
| B. | Lowering the interest rate charged for loans at the discount window. |
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Capitalism Without Capital The Rise Of The Intangible Economy
Authors: Jonathan Haskel, Stian Westlake
1st Edition
0691183295, 978-0691183299
