A decrease in the required reserve ratio
A. will increase the money supply.
B. will not change the money supply.
C. will decrease the money supply.
D. will decrease the discount rate.
Answer: A
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Consider two banks: Bank A and Bank B. Bank A has total assets worth $50,000 and total liabilities worth $24,000. Conversely, Bank B has total assets worth $100,000 and total liabilities worth $90,000
Given this information, which of the two banks is more prone to bank runs and why?
Which of the following is not an argument in favor of export promotion over import substitution?
(a) international competition compels domestic producers to become more efficient. (b) exposure to world markets provides greater opportunities to learn new technologies. (c) producing for export permits greater specialization and economies of scale. (d) outward-looking development promotes larger firms.