Author Question: The money multiplier A) equals 1 over the required reserve ratio. B) is an expression that ... (Read 92 times)

Mr.Thesaxman · **on:** Jun 30, 2018

The money multiplier

A) equals 1 over the required reserve ratio.
B) is an expression that converts the monetary base to the money supply.
C) is larger than the simple deposit multiplier.
D) is completely controlled by the Fed.

Question 2

Hector's wealth is zero, he expects to work for another 45 years at a constant salary of 80,000 and live for another 60 years. Yearly taxes are 20,000, and Hector received a one-time tax rebate of 5,000 during his first year of work.

If Hector completely smooths consumption over his lifetime, his annual consumption is A) 37,516.67.
B) 44,916.67.
C) 45,083.33.
D) 60,111.11.