Suppose that you are a bank manager, and the Federal Reserve raises the required reserve ratio from 10% to 12%. What actions would you need to take?
A. You would have to reduce lines to make up for the necessary increase in reserves
B. You would need to make loans to match the new reserve requirement
C. You would have to charge less for your loans because rates are now at 12%
Ans: A. You would have to reduce lines to make up for the necessary increase in reserves
Economics
You might also like to view...
Which of the following taxes causes the greatest shift of the Lorenz curve toward the line of equality?
A) proportional income tax B) regressive income tax C) flat-rate income tax D) progressive income tax
Economics
Suppose the total cost of producing T-shirts can be represented as TC = 50 + 2q. The marginal cost of the 5th T-shirt is
A) 2. B) 10. C) 12. D) 60.
Economics