Question 21 (Mandatory) (2 points) () Listen The required reserve ratio is ( a) the percentage of deposits that a bank must, by law, lend to its customers. O b) the percentage of deposits that a bank must, by law, keep as reserves. O c) the percentage of required reserves that exceed total reserves. O d) the percentage of excess reserves that must be loaned. Question 22 (Mandatory) (2 points) Listen If the government wants to end a recession by closing a contractionary gap, it should (a) lower government spending, thereby shifting the aggregate supply curve to the left. O b) lower taxes, thereby shifting the aggregate demand curve to the right. ( c) raise government spending, thereby shifting the aggregate demand curve to the left. O d) lower spending, thereby shifting the aggregate demand curve to the right.Question 23 (Mandatory) (2 points) Saved 1) Listen In a fractional reserve banking system, a) bank reserves need to be backed by gold. O b) bank reserves are always greater than bank loans. O c) banks keep less than 100 percent of deposits in cash. ( d) banks can never experience a banking panic.Question 24 (Mandatory) (2 points) ) Listen Figure 11-1 AS Assume the distance between AD, and AD, is al to the distance between ADeand AD:. Price Level ( dollars) AI AD ADS . AD2 Y's Real GDP (dollars) Refer to Figure 11-1. If the economy is in equilibrium at point C, then, other things equal, an increase in government spending will O a) lower real GDP and increase the price level. O b) increase the price level and leave real GDP unchanged. c) decrease the price level. O d) lower real GDP and leave the price level unchanged.Question 25 (Mandatory) (2 points) Saved ) Listen Suppose the reserve requirement is 10 percent. If an extra $50 billion in reserves is injected into the banking system by the Fed, by how much can total checkable deposits in the banking system rise? (Assume that the banks keep excess reserves at zero.) O a) $45 billion ( b) $50 billion O c) $500 billion d) $5 billion Question 26 (Mandatory) (2 points) ~ Saved )Listen To increase equilibrium output, the Fed could O a) increase the reserve requirement. b) increase the discount rate. O c) purchase government bonds. Od) sell government bonds.Question 2? (Mandatory) {1 point) v' Saved all One tool the Federal Reserve uses to conduct monetary policy is cutting income taxes. Question 28 I Ma ndatory) {2 points) all The quantity theory of money asserts that O a) changes in the quantity of money are directly related to changes in nominal GDP. 0 [3) changes in nominal GDP are inversely related to changes in the velocity of money. changes in the quantity of money are positively related to changes in the c} velocity of money. 0 '5'} changes in the quantity of money are unrelated to changes in the price level. Question 29 (Mandatory) {1 point) y' Saved an When the aggregate supply curve is vertical, an increase in the money supply will result in an increase in both equilibrium aggregate output and the equilibrium price level. Question 30 (Mandatory) (2 points)