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5 Written questions

5 Matching questions

  1. Money is functioning as a store of value if you
  2. Suppose the entire banking system has $10,000 in excess reserves and a required reserve ratio of 20 percent. The deposit-creation potential of the banking system is:
  3. If total reserves for a bank are $25,000, excess reserves are zero and demand deposits are $100,000, then the money multiplier must be:
  4. Most market transactions are made using
  5. Barter
  1. a $50,000
  2. b Cash
  3. c 4.00
  4. d Is the direct exchange of one good or service for another
  5. e Put it in a savings account so you can buy a new car next summer

5 Multiple choice questions

  1. 10
  2. Savings accounts
  3. Banks make loans to borrowers
  4. Pools of money used to buy interest-bearing bonds
  5. $280,000

5 True/False questions

  1. If excess reserves are $30,000, demand deposits are $500,000 and the minimum reserve requirement is 10 percent, then total reserves are:$5,000

          

  2. When an individual deposits cash or coins in a transactions account, there isA change in the composition of the money supply, but not the size

          

  3. Suppose the entire banking system has $50 million in excess reserves and a required reserve ratio of 10 percent. The deposit-creation potential of the banking system is$500 million

          

  4. Suppose Caroline finds $10,000 under her bed and deposits it in her checking account. If the required reserve ratio is 25 percent, this deposit has the potential of increasing the money supply byDoes not change in value

          

  5. Use the following balance sheet for Bank of the Universe, which is one of many banks in a banking system.
    Table 13.2—Bank of the Universe Balance Sheet
    SAME VALUES AS ABOVE

    Refer to Table 13.2. With a required reserve ratio of 10 percent, Bank of the Universe can make new loans in the amount of:
    $50,000

          

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