A bank has $20,000 in deposit liabilities. If the required reserve ratio is 20%, how much can the bank lend?

a)$8000

b)$4000

c)$100000

d)$16000

In the days of the fur trade in Canada, values of trade goods were expressed in terms of prime quality adult beaver pelts. This is an example of money functioning as:

aa store of value

b) a hedge against inflation

c a medium of exchange

da measure of value

If monetary authorities want to reduce bank lending, they can:

a) sell government securities in the open market

b) do all of these

c) lower the overnight target interest rate

d) buy government securities in the open market

The Bank of Canada is an agency of the federal government responsible for:

a) acting as the government's banker

b) issuing of paper currency

c) all of these

d) monetary policy

e) acting as the chartered banks' banker

If you are estimating your expenses for college next year you are using money as an

a) income earning asset

b) measure of value

c) means of exchange

d) investment

e) store of purchasing power

If the Bank of Canada buys a $50,000 government security from a chartered bank, the reserve ratio is 10% and each bank in the system lends out its excess reserves, the money supply would increase by:

a) $500,000

b) $450,000

c$200,000

d100,000