Assume that the Federal Reserve has purchased a 1,000 security ...

[imanialler]

Assume that the Federal Reserve has purchased a 1,000 security from an individual, the required reserve ratio is 20 percent, and that individual deposits the proceeds in his bank. What is the increase in excess reserves for this bank?
 
  a. 200
  b. 1,000
  c. 1,200
  d. 800
  e. 2,000

Question 2

Roads during the 1800s proved to be a preferred transportation alternative to railroads and thus competed successfully for profits.
 
  Indicate whether the statement is true or false

[ktidd]

Answer to Question 1

D

Answer to Question 2

False