Author Question: Suppose the currency drain ratio is 25 percent and the desired reserve ratio is 20 percent. The ... (Read 122 times)

LaDunn · **on:** Jun 29, 2018

Suppose the currency drain ratio is 25 percent and the desired reserve ratio is 20 percent. The money multiplier equals

A) 4.00. B) 5.42. C) 2.00. D) 2.78. E) 3.00.

Question 2

The local Allied Moving Company begins this year with capital equal to 250,000. During the year the firm depreciates 150,000 worth of its capital and ends the year with capital equal to 250,000.

Which statement correctly summarizes Allied Moving Company's investment?
A) Allied Moving Company made gross investment of 250,000 during the year.
B) Allied Moving Company made no net investment during the year.
C) Allied Moving Company made no gross investment during the year.
D) Allied Moving Company made no capital investment during the year.
E) Allied Moving Company made net investment of 150,000 during the year.