If a single banks faces a required reserve ratio of 20 percent, has total reserves of $500,000 . and checkable deposit liabilities of $400,000 . what is the maximum amount of money this bank could create (add to the money supply)?

Suppose we were analyzing the Turkish lira per euro foreign exchange market. If The Euro-Area's risk level falls relative to Turkey and nothing else changes, then the:

a. The supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing a depreciation of the euro. b. The supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market falls, causing an uncertain change in the value of the euro. c. The supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market rises, causing an appreciation of the euro. d. Neither supply nor demand in the foreign exchange market change because relative international prices influence trade flows and not the exchange rate. e. The supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market rises, causing an uncertain change in the value of the euro.

Economists develop models to

A) capture every detail of the real world. B) make their arguments more realistic. C) justify the assumptions they make about people's behavior. D) help us understand economic phenomena in the real world.