Assume company x deposits $100,000 in cash in a commercial bank. If no excess reserves exist at the time this deposit is made and the reserve ratio is 20 percent, the bank can increase loans by a maximum of $500,000.
Reserve ratio = 20% = 20/100 = 0.25
Initial Money supply = (1/Reserve ratio)*New Deposit = (100,000/0.25) = $ 400,000
Reserve ratio = Rerserve / Deposit
=> Reserves = 0.25*100,000 = 25,000
Max Increase in Money Supply = Initial Money Supply + Reserves/ Reserve Ratio
= $ 400,000 + 100,000
= $ 500,000.
The term commercial bank refers to financial institutions that accept deposits, provide checking account services, issue various loans, and provide basic financial products such as certificates of deposit (CDs) and savings accounts to individuals and small businesses. refers to
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Answer:
The answer is "Option C".
Explanation:
If options of different retained earnings are assessed, it must use the corresponding annual cost method for drawing a concrete conclusion. As per the task, which is defined in the attached file please find it.
Answer:
The correct answer is letter "A": total value from trade in a market.
Explanation:
Canadian economist Alex Tabarrok (born in 1966) explains social surplus as the sum of consumer surplus, producer surplus, and bystanders surplus. Tabarrok takes an integrative approach in consumer surplus by stating <em>social surplus encompasses every economic trade in the market rather than only consumers and producers surplus.</em>
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Besides, Tabarrok believes when there are major external costs or benefits, the market will not reach its social surplus.
A. The total cost of commuting from any given distance to work will reduce because the indirect cost of the commute will fall.
B. The total cost of commuting from any given distance to work will increase because the indirect cost of the commute will rise.
C. The total cost of commuting from any given distance to work will reduce because the direct cost of the train ticket will fall.
D. The total cost of commuting from any given distance to work will increase because the direct cost of the train ticket will rise
Answer:
A. The total cost of commuting from any given distance to work will reduce because the indirect cost of the commute will fall
Explanation:
Technological advances in wireless communication technology, would reduce the indirect cost of long commutes from any given distance which would cause a reduction in the total cost of commuting, as a function of the effect of geographic area of cities. Direct cost of train ticket would not be affected as the efficiency of the services that train and car riders would offer would increase, as well as the satisfaction they would also enjoy from such technological advances.
Answer:
Product Bundle
Explanation:
Product bundle is the term which is defined as where the several individual services or goods which are sold to the consumers in a single combined package. And the few retailers only sell the items as a product bundle not individually.
In this scenario, the Salon offers the combined package of $50 and the individually the prices are different . So, it will be called or known as the Product bundle.
