Assume that when $100 of new reserves enter the banking system, the money supply ultimately increases by $625 . Assume also that no banks hold excess reserves and that the entire money supply consists of bank deposits. If, at a point in time, reserves for all banks amount to $500, then at that same point in time, loans for all banks amount to $2,625

Refer to the figure above. What is the maximum profit that the firm can make?

A) $30 B) $60 C) $90 D) $180

Scott is a woodworker and charges $125 an hour for his time manufacturing custom-made wood products. For his wife's birthday, he designs and creates an intricate birdseye maple jewelry box that takes him 15 hours to complete. By how much and in what

direction does GDP change as a result of his efforts? A) GDP rises by $1,875. B) GDP is not affected by Scott's production of the jewelry box. C) GDP rises by $125. D) GDP falls by $1,875.