Author Question: Consider the following T-account for National City Bank: Assets Liabilities Reserves 10,000 ... (Read 75 times)

cnetterville · **on:** Jun 29, 2018

Consider the following T-account for National City Bank:

Assets Liabilities
Reserves 10,000 Deposits 100,000
Loans 90,000

If the required reserve ratio is lowered to 8 percent, how much can National City loan out?
A) 10,000 B) 8,000 C) 2,000 D) 0

Question 2

During a deflationary period

A) the nominal interest rate is less than the real interest rate.
B) the real interest rate is less than the nominal interest rate.
C) the nominal interest rate does not change.
D) the price level rises.