A bank reports reserves of 500,000, physical capital of 200,000, ...

[ts19998]

A bank reports reserves of 500,000, physical capital of 200,000, loans of 1,000,000, deposits of 1,000,000, and owners' equity of 500,000. If the desired reserve ratio is 5 percent, the bank's desired reserves are
 
  A) 25,000. B) 500,000. C) 1,000,000. D) 50,000. E) 10,000.

Question 2

Consider a production possibility frontier with jeans on the vertical axis and shoes on the horizontal axis. As a country moves along the frontier closer to the vertical axis,
 
  A) the opportunity cost of producing jeans decreases.
  B) inefficient production occurs.
  C) the opportunity cost of producing jeans increases.
  D) there are fewer tradeoffs.
  E) the opportunity cost of producing shoes increases.

[dantucker]

Answer to Question 1

D

Answer to Question 2

C

[ts19998]

TYSM

[matt95]

Excellent