(1)

ChabotVilla Bank confronts a reserve requirement of 13.5 percent and currently holds $240,000 dollars in excess reserves. If a depositor withdraws $18,000, the excess reserves of the bank will

Group of answer choices

increase by $2,430

decline by $2,430

decline by $15,570

decline by $18,000

decline by $32,400

(2)

Suppose Jack transfer $2,800 from his savings account to his checking account. How does this action affect the M1 and M2 money supplies?

Group of answer choices

M1 is unchanged, and M2 falls by $2,800.

M1 rises by $2,800, and M2 falls by $2,800.

M1 rises by $2,800, and M2 is unchanged.

M1 rises by $2,800, and M2 rises by $2,800.

M1 and M2 are both unchanged.

(3)

Drawing on her account at Regional Bank, Samantha writes a check to Isabella, who deposits the check in her saving account at Local Bank. Once the check has cleared, which of the following will occur to the money supply?

Group of answer choices

M1 will increase.

there will be no change in M1.

M1 will decrease.

M2 will increase.

(4)

?Suppose The Springfield Bank has loaned $500 to Mr. Kim Chabot for his business. Mr. Chabot repays the loan with a check written against his own bank, the First National Bank. Which of the following is likely to happen as a result of this transaction?

Group of answer choices

?The reserves at the Springfield Bank will fall.

?The reserves at the First National Bank will increase.

?Checkable deposits at the First National Bank will increase.

The First National Bank will make more loans than before.

?The reserves and checkable deposits of the First National Bank will decrease.

(5)

Suppose Fionacashes a $1,500traveler check at a commercial bank. The immediate effect is

Group of answer choices

a $1,500 decrease in the M1 money supply.

no change in the M1 money supply, but the M2 money supply increases.

no change in the M1 money supply, but the M2 money supply decreases.

a $1,500 increase in the M1 money supply.

no change in both the M1 money supply and the M2 money supply.

(6)

\f\f