If the Fed lowers the required reserve ratio, __________ in the banking system will remain unchanged but __________ will rise. This will (likely) lead to an increase in new loans and checkable deposits and a(n) __________ in the money supply
A) excess reserves; vault cash; increase
B) reserves; vault cash; decrease
C) reserves; excess reserves; increase
D) reserves; required reserves; increase
E) none of the above
C
You might also like to view...
As residents of developing countries increase their chocolate consumption, the increased production of cocoa results in
A) increased opportunity cost of cocoa production. B) decreased opportunity cost of cocoa production. C) no change in production of other goods and services. D) increased production of other goods and services.
Gracyn wants to invest in a specific company. She would like little risk and a guaranteed return. She is not hoping to earn a big profit off her investment, just a reliable return. Which investment would be best for her needs?
a. stocks b. bonds c. retained earnings d. mortgage-backed securities