The extra cost associated with undertaking an activity is called

A large country imposes capital controls that prohibit foreign borrowing and lending by domestic residents. The country is currently running a financial account deficit. The imposition of the capital controls will cause

A) net exports to increase. B) real domestic interest rates to rise. C) real world interest rates to fall. D) desired national saving to fall.

If the required reserve ratio is 10 percent, a $100 deposit will ultimately allow the banking system to create how much money?

A. $190. B. $90. C. $1,000. D. $100.