Banks deposit funds at the central bank, because:
a. They need them there in order be able to purchase government securities.
b. They can be counted as required reserves.
c. Both of the above are true.
d. Actually, banks do not deposit funds at the central bank. They deposit them at the Treasury.
Question 2
Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the real GDP and reserve-related (central bank) transactions in the context of the Three-Sector-Model?
a. Real GDP falls, and reserve-related (central bank) transactions become more negative (or less positive).
b. Real GDP falls and reserve-related (central bank) transactions remain the same.
c. Real GDP and reserve-related (central bank) transactions remain the same.
d. Real GDP rises, and reserve-related (central bank) transactions remains the same.
e. There is not enough information to determine what happens to these two macroeconomic variables.
The insect family Coenagrionidae is found in the order Odonata and the suborder Zygoptera.
Joseph Banks
Central portal of the west facade, Reims Cathedral, France.
A typical bank statement.
Example of Reconciling a Bank Statement Cont.
Nitrogen dioxide decomposes at 300°C via a second-order process to produce nitrogen monoxide ...