This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: A bank's assets consist of 1,000,000 in total reserves, 2,100,000 in loans, and a building worth ... (Read 82 times)

DelorasTo

  • Hero Member
  • *****
  • Posts: 548
on: Jun 30, 2018
A bank's assets consist of 1,000,000 in total reserves, 2,100,000 in loans, and a building worth 1,200,000 . Its liabilities and capital consist of 3,000,000 in demand deposits and 1,300,000 in capital. If the bank is required to keep reserves equal to one-third of deposits, what is the level of the bank's excess reserves? How much money could the excess reserves be used to create in the banking system as a result?
 a. zero; zero
 b. 300,000; 300,000
 c. 300,000; 900,000
 d. 700,000; 2,100,000

Question 2

When aggregate demand declines unexpectedly and wage contracts are fixed, then the average price level will:
 a. increase and business firms will hire new workers.
  b. decline and firms will reduce wages.
  c. decline and business firms will lay off workers.
  d. increase and business firms will lay off workers.
  e. increase and business firms will increase wages.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Beatricemm

  • Sr. Member
  • ****
  • Posts: 323
Reply #1 on: Jun 30, 2018
Answer to Question 1

a

Answer to Question 2

c


DelorasTo

  • Member
  • Posts: 548
Reply 2 on: Jun 30, 2018
Gracias!

sultana.d

  • Member
  • Posts: 320
Reply 3 on: Yesterday
Excellent

« previous next »
 

Did you know?

Approximately 15–25% of recognized pregnancies end in miscarriage. However, many miscarriages often occur before a woman even knows she is pregnant.

Did you know?

All patients with hyperparathyroidism will develop osteoporosis. The parathyroid glands maintain blood calcium within the normal range. All patients with this disease will continue to lose calcium from their bones every day, and there is no way to prevent the development of osteoporosis as a result.

Did you know?

Drug abusers experience the following scenario: The pleasure given by their drug (or drugs) of choice is so strong that it is difficult to eradicate even after years of staying away from the substances involved. Certain triggers may cause a drug abuser to relapse. Research shows that long-term drug abuse results in significant changes in brain function that persist long after an individual stops using drugs. It is most important to realize that the same is true of not just illegal substances but alcohol and tobacco as well.

Did you know?

The most dangerous mercury compound, dimethyl mercury, is so toxic that even a few microliters spilled on the skin can cause death. Mercury has been shown to accumulate in higher amounts in the following types of fish than other types: swordfish, shark, mackerel, tilefish, crab, and tuna.

Did you know?

Malaria mortality rates are falling. Increased malaria prevention and control measures have greatly improved these rates. Since 2000, malaria mortality rates have fallen globally by 60% among all age groups, and by 65% among children under age 5.

Total hip prosthesis. Total hip prosthesis.
Proteins are body-building nutrients Proteins are body-building nutrients
An educational institution has total direct labor and material costs of $1964 per student. Its ... An educational institution has total direct labor and material costs of $1964 per student. Its ...
What is the total number of valence electrons in a silicate ion, SiO32-? What is the total number of valence electrons in a silicate ion, SiO32-?
A debt payment of $7500 is due in 24 months. If money is worth 7.2% p.a. compounded quarterly, ... A debt payment of $7500 is due in 24 months. If money is worth 7.2% p.a. compounded quarterly, ...
Raman has a line of credit loan with the ICICI bank. The initial loan balance was $72000.00. ... Raman has a line of credit loan with the ICICI bank. The initial loan balance was $72000.00. ...
Video: Simple and Double Sugar

For a complete list of videos, visit our video library