Assume the desired reserve ratio is 10 percent, banks loan all ...

[Kikoku]

Assume the desired reserve ratio is 10 percent, banks loan all excess reserves and the currency drain is zero. If the Fed sells 100 million of U.S. government securities to Boise Bank, the monetary base increases by
 
  A) 1 million.
  B) 10 million.
  C) 100 million.
  D) 1,000 million.
  E) 90 million.

Question 2

If a tax is imposed on a good,________.
 
  A) consumer surplus increases
  B) producer surplus increases
  C) the quantity of the good traded in the market increases
  D) the equilibrium quantity of the good in the market falls

[bigsis44]

Answer to Question 1

C

Answer to Question 2

D