Answer:
As the price rises, the quantity demanded decreases and the quantity supplied increases.
Explanation:
When a shortage occurs, demand for a product is high and is not being matched by supply (supply is low).
So to bring demand down and increase supply, we need to increase the price.
According to the law of demand and increase in price results in a decrease in demand.
The law of supply states that when price increases there will be an increase in supply, making more goods available and eliminating shortage.
This is illustrated in the attached diagram.
Answer:
The change in checking deposit is equal to $22,727.27.
Explanation:
An amount of $2,500 is deposited in a checking account.
The required reserve ratio is 0.11 or 11%.
A part of this deposit will go to the required reserve and the rest will be added in the checking deposit of the bank.
The change in the checking deposits will be
= amount deposited
=
= $22,727.27