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5 Written questions

5 Matching 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:
  2. Barter
  3. Professor Williams tutors her next-door neighbor's son in economics. Instead of paying her for this service, the neighbor washes the professor's car. This is an example of
  4. Suppose the entire banking system has $70,000 in excess reserves and a required reserve ratio of 25 percent. The deposit-creation potential of the banking system is
  5. Ceteris paribus, the money supply becomes smaller when:
  1. a Barter
  2. b $280,000
  3. c Is the direct exchange of one good or service for another
  4. d An individual repays the money that he borrowed from a bank
  5. e $80,000

5 Multiple choice questions

  1. Use it to compare two houses in different price ranges
  2. $30,000
  3. $5,000
  4. Buy lunch at a fast food restaurant for yourself and your friend
  5. The money supply becomes smaller

5 True/False questions

  1. The smallest component of the basic money supply is in the form ofTraveler's checks

          

  2. Suppose a bank has $200,000 in deposits and a minimum reserve requirement of 15 percent. Then required reserves are:$30,000

          

  3. Most market transactions are made usingCash

          

  4. Initially a bank has a minimum reserve requirement of 15 percent and no excess reserves. If $200,000 is deposited in the bank, then ceteris paribus:Unlimited

          

  5. Suppose the entire banking system has $10 million in excess reserves and a required reserve ratio of 5 percent. The deposit-creation potential of the banking system is:$200 million