The desired reserve ratio is 10 percent. Joe deposits $1,000 in Bank A. Bank A keeps its minimum desired reserves and lends the excess to Fred
Fred spends his loan at J.C. Penney. J.C. Penney deposits the check it receives from Fred in Bank B. Bank B keeps its minimum desired reserves and lends the excess to Mary. How much can Bank B lend to Mary?
A) $90 B) $900 C) $810 D) $1,000 E) $100
C
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Suppose Panama produces only two goods, bananas and hats. If Panama has a comparative advantage in bananas, a move toward free trade will
A) benefit hat workers, harm banana workers, but harm the nation as a whole. B) harm hat workers, harm banana workers, but benefit the nation as a whole. C) harm hat workers, benefit banana workers, but benefit the nation as a whole. D) benefit hat workers, harm banana workers, but benefit the nation as a whole.
The knowledge and skills that workers have built up through education and training programs is known as ________
A) the college premium B) human capital C) productivity D) financial torsion