The ________ the desired reserve ratio, the ________ the ________ ...

[dalyningkenk]

The ________ the desired reserve ratio, the ________ the ________ in the quantity of money created from an initial increase of 100,000 in the monetary base.
 
  A) smaller; larger; decrease
  B) larger; larger; decrease
  C) larger; smaller; decrease
  D) smaller; larger; increase
  E) larger; larger; increase

Question 2

Refer to Figure 19.3. At the exchange rate of 120 yen per dollar, the United States is experiencing a
 
  A) balance of payments deficit. B) balance of payments surplus.
  C) capital account deficit. D) current account surplus.

[lkoler]

Answer to Question 1

D

Answer to Question 2

A