Financing government spending by selling bonds to the public, which pays for the bonds with currency,
A) leads to a permanent decline in the monetary base.
B) leads to a permanent increase in the monetary base.
C) leads to a temporary increase in the monetary base.
D) has no net effect on the monetary base.
D
Economics
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A bank's reserve ratio is 5 percent and the bank has $1,000 in deposits. It's reserves amount to
a) $5. b) $50. c) $95. d) $950.
Economics
What happens to the money multiplier when the reserve requirement increases from 20% to 25%?
a) It stays the same. b) It increases from 20 to 25. c) It decreases from 5 to 4. d) It falls to zero.
Economics