Author Question: If a bank had the reserve requirement of 10 percent and excess reserves of 2,000, the largest loan ... (Read 161 times)

awywial · **on:** Jun 30, 2018

If a bank had the reserve requirement of 10 percent and excess reserves of 2,000, the largest loan it could legally extend would be:
a. 200.
b. 1,800.
c. 2,000.
d. 20,000.

Question 2

Suppose the inflation rate has risen 0.5 percent a year for the past three years. Using this experience an individual forecasts a 0.5 percent rise in the coming year's inflation rate. This is an example of:
a. traditional expectations.
b. rational expectations.
c. adaptive expectations.
d. reflective expectations.
e. deductive expectations.