PSU Econ 104 Final Exam Actual Questions and Answers 2024 Graded A+ - Brown
1 view 0 purchase
Course
BROWN UNIVERSITY
Institution
BROWN UNIVERSITY
PSU Econ 104 Final Exam Actual Questions and Answers 2024 Graded A+ - Brown
If the required reserve ration is 20%, the simple deposit multiplier is _______
A. 2
B. 5
C. 10
D. 20
B. 5
1/.2 = 5
Imagine that Kristy deposits $10,000 of currency into her checking account deposit at Bank A an...
psu econ 104 final exam actual questions and answe
Written for
BROWN UNIVERSITY
All documents for this subject (41)
Seller
Follow
missyk2030
Content preview
PSU Econ 104 Final Exam Actual Questions and
Answers 2024 Graded A+ - Brown
If the required reserve ration is 20%, the simple deposit multiplier is _______
A. 2
B. 5
C. 10
D. 20
B. 5
1/.2 = 5
Imagine that Kristy deposits $10,000 of currency into her checking account
deposit at Bank A and the reserve ratio is 20%. As a result of Kristy's deposit,
Bank A's reserves immediately increase by:
A. $2,000
B. $8,000
C. $ 10,000
D. $50,000
C. $10,000
This is how much money she puts in the bank.
Imagine that Kristy deposits $10,000 of currency into her checking account
deposit at Bank A and the reserve ratio is 20%. As a result of Kristy's deposit,
Bank A's required reserves increase by:
A. $2,000
B. $8,000
C. $10,000
D. $50,000
A. $2,000
If the bank must keep 20%, then $10,000 *.2 = $2,000
Imagine that Kristy deposits $10,000 of currency into her checking account
deposit at Bank A and the reserve ratio is 20%. As a result, of Kristy's deposit,
Bank A's excess reserves increase by:
A. $2,000
B. $8,000
C. $10,000
D. $50,000
B. $8,000
Their excess reserves will increase by however much she put in minus how much
they are required to keep.
$10,000-$2,000 = $8,000
Imagine that Kristy deposits $10,000 of currency into her checking account
deposit at Bank A and the reserve ratio is 20%. As a result of Kristy's deposit,
Bank A's excess reserves increase by:
A. $2,000
B. $8,000
, C. $10,000
D. $50,000
B. $8,000
The bank can only lend out whatever their excess reserves are equal to. From
Kristy's deposit alone, the only excess reserves the bank has is equivalent to $8,000
Imagine that Kristy deposits $10,000 of currency into her checking account
deposit at Bank A and the reserve ratio is 20%. As a result of Kristy's deposit,
checking account deposits in the banking system as a whole (including the
original deposit) could eventually increase up to a maximum of:
A. $8,000
B. $10,000
C. $50,000
D. $100,000
C. $50,000
$10,000/.2 = $50,000
When you open a checking account at Bank of America, Bank of America:
A. Has more reserves and more excess reserves
B. Has more reserves, but excess reserves remain unchanged
C. Has more deposits and less in excess reserves
D. Has more deposits, but excess reserves remain unchanged
A. Has more reserves and more excess reserves
Immediately after depositing your money, the bank isn't yet able to loan it out. This
means that the reserves will increase (since you deposit money,) and there will be
excess reserves because the money you deposited wasn't able to be loaned out yet.
Consider the following simplified balance sheet for National City Bank:
Assets:
Reserves: $10,000
Loans: $90,000
Liabilities:
Deposits $100,000
If the required reserve ratio is lowered to 8%, how many additional funds can
National City loan out?
A. $10,000
B. $8,000
C. $2,000
D. $0
C. $2,000
We can assume that the reserve ratio is 10% since $100,000/$10,000=10.
Therefore, lowering the ratio to 8% would allow the bank to loan out $2,000 more
dollars.
If the required reserve ratio is RR, the simple deposit multiplier is defined as:
A. 1/(1-RR)
B. 1/(RR)
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller missyk2030. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $14.49. You're not tied to anything after your purchase.
