Sunday, August 9, 2009

Help with economic homework!! Please?

1Suppose the reserve requirement is 10 percent. If a bank has $5 million of checkable deposits and actual reserves of $500,000, the bank:



a. can safely lend out $500,000. b. can safely lend out $5 million. c. can safely lend out $50,000 d. cannot safely lend out more money



2A Federal funds rate reduction that is caused by monetary policy will:



a. increase the prime interest rate. b. decrease the size of the monetary multiplier. c. increase the Fed%26#039;s discount rate. d. decrease the prime interest rate.



3Other things equal, if the supply of money is reduced:



a. the demand for money will increase. b. the interest rates will fall. c. bond prices will fall. d. investment spending will increase.



Help with economic homework!! Please?education loans





You really want this to post it twice ok



1) I would go with a.



3)i would go with c



2 im a lttle unsure maybe d

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