This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: A bank's assets consist of 1,000,000 in total reserves, 2,100,000 in loans, and a building worth ... (Read 69 times)

DelorasTo

  • Hero Member
  • *****
  • Posts: 548
on: Jun 30, 2018
A bank's assets consist of 1,000,000 in total reserves, 2,100,000 in loans, and a building worth 1,200,000 . Its liabilities and capital consist of 3,000,000 in demand deposits and 1,300,000 in capital. If the bank is required to keep reserves equal to one-third of deposits, what is the level of the bank's excess reserves? How much money could the excess reserves be used to create in the banking system as a result?
 a. zero; zero
 b. 300,000; 300,000
 c. 300,000; 900,000
 d. 700,000; 2,100,000

Question 2

When aggregate demand declines unexpectedly and wage contracts are fixed, then the average price level will:
 a. increase and business firms will hire new workers.
  b. decline and firms will reduce wages.
  c. decline and business firms will lay off workers.
  d. increase and business firms will lay off workers.
  e. increase and business firms will increase wages.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Beatricemm

  • Sr. Member
  • ****
  • Posts: 323
Reply #1 on: Jun 30, 2018
Answer to Question 1

a

Answer to Question 2

c


DelorasTo

  • Member
  • Posts: 548
Reply 2 on: Jun 30, 2018
Great answer, keep it coming :)

kusterl

  • Member
  • Posts: 315
Reply 3 on: Yesterday
Gracias!

« previous next »
 

Did you know?

Always store hazardous household chemicals in their original containers out of reach of children. These include bleach, paint, strippers and products containing turpentine, garden chemicals, oven cleaners, fondue fuels, nail polish, and nail polish remover.

Did you know?

In the United States, congenital cytomegalovirus causes one child to become disabled almost every hour. CMV is the leading preventable viral cause of development disability in newborns. These disabilities include hearing or vision loss, and cerebral palsy.

Did you know?

Allergies play a major part in the health of children. The most prevalent childhood allergies are milk, egg, soy, wheat, peanuts, tree nuts, and seafood.

Did you know?

Pink eye is a term that refers to conjunctivitis, which is inflammation of the thin, clear membrane (conjunctiva) over the white part of the eye (sclera). It may be triggered by a virus, bacteria, or foreign body in the eye. Antibiotic eye drops alleviate bacterial conjunctivitis, and antihistamine allergy pills or eye drops help control allergic conjunctivitis symptoms.

Did you know?

Of the estimated 2 million heroin users in the United States, 600,000–800,000 are considered hardcore addicts. Heroin addiction is considered to be one of the hardest addictions to recover from.

Teresa Hubbard and Alexander Birchler, Detached Building. Teresa Hubbard and Alexander Birchler, Detached Building.
Example of Reconciling a Bank Statement Example of Reconciling a Bank Statement
Building a Client Base Cont. Building a Client Base Cont.
Different sources for 100 calories worth of protein Different sources for 100 calories worth of protein
Proteins are body-building nutrients Proteins are body-building nutrients
Last year, Terrific Copying had total revenue of $475 000, while operating at 60% of capacity. ... Last year, Terrific Copying had total revenue of $475 000, while operating at 60% of capacity. ...
Video: Covalent bonds - role in the body

For a complete list of videos, visit our video library