Suppose the required reserve ratio is 20 percent. If banks are ...

[Bob-Dole]

Suppose the required reserve ratio is 20 percent. If banks are conservative and choose not to loan all of their excess reserves, the real-world deposit multiplier is
 
  A) less than 5. B) equal to 5. C) greater than 5. D) equal to 20.

Question 2

The current account does not include which of the following?
 
  A) U.S. holdings of foreign assets B) net transfers
  C) net exports D) net investment income

[livaneabi]

Answer to Question 1

A

Answer to Question 2

A