An increase in the required reserve ratio would be
a. a restrictive policy because it lowers the amount of total reserves in the banking system.
b. a restrictive policy because it lowers the amount of excess reserves in the banking system.
c. an expansionary policy because it raises the amount of total reserves in the banking system.
d. an expansionary policy because it raises the amount of excess reserves in the banking system.
e. an expansionary policy because it raises the amount of required reserves in the banking system.
B
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____________are generally associated with labor and raw materials.
Fill in the blank(s) with the appropriate word(s).
A nation's country-risk premium increases if:
a. Central bank policies become more predictable. b. Large corporations, on average, increase their debt-to-equity ratios, thereby making their operations more volatile. c. Expected inflation becomes harder to predict. d. The average maturity structure in the nation rises. e. Its government becomes more stable.