Author Question: What is the maximum amount a bank can lend? A) its total reserves B) its excess reserves C) its ... (Read 118 times)

newyorker26 · **on:** Jun 30, 2018

What is the maximum amount a bank can lend?

A) its total reserves
B) its excess reserves
C) its excess reserves divided by the required reserve ratio
D) the value of its checkable deposits times the required reserve ratio

Question 2

The constant growth rate rule for money, as initially proposed by Milton Friedman, has been adjusted ________.

A) to take the problem of moral hazard in account
B) to account for the role played by adaptive expectations in policy formation
C) for the difference between real and nominal economic variables
D) to allow for possible short-run movements in velocity