All categories

4 years ago

What is the relationship between changes in the money supply and changes in the reserve requirement

Business

1 answer:

EastWind [94]4 years ago

3 0

Answer:

Reserve requirements have an indirect relationship with the money supply

Explanation:

Reserve requirements are a portion of customer deposits a bank is supposed to keep in its custody at all times. The federal reserve gives guidance on the proposition of reserve requirement that a bank should hold. Reserve requirement is usually a percentage of the deposits. Banks cannot loan out their reserves.

Reserve requirements have an inverse relationship with the money supply in the economy. If the reserve requirement is high, banks will have a lower proposition of customer deposits to loan out. When reserve requirement is low, banks will have a bigger proposition of deposits to loan out, thereby increasing the money supply in the economy.

You might be interested in

Since the creation of the Hershey candy bar over 100 years ago, the price of chocolate has fluctuated, but the price of the cand

777dan777 [17]

Answer:

C) bottom-up marketing

Explanation:

According to my research on the different business strategies, I can say that based on the information provided within the question Hershey is engaging in bottom-up marketing. This can be said because this marketing approach focuses on finding a workable tactic and then building on the tactic to create a powerful strategy. In this situation it seems that Hershey's tactic for the dealing with the fluctuation in price of chocolate, which is by adjusting the size of the chocolate bars instead of it's price.

I hope this answered your question. If you have any more questions feel free to ask away at Brainly.

8 0

3 years ago

The following information relates to next year's projected operating results of the Children's Division of Grunge Clothing Corpo

Komok [63]

Answer:

The annual financial disadvantage of eliminating the division is $30,000.

Explanation:

contribution margin = revenue - variable costs = $200,000

fixed expenses = $500,000

net loss = $300,000.

If the division is eliminated, only $170,000 of the fixed expenses can be avoided, therefore the company's fixed expenses will remain at $330,000.

Therefore, eliminating the children's division will result in a $30,000 (= $330,000 - $300,000) decrease in net income.

4 0

3 years ago

In the current year, PULR Company sold land for $ 81,000 cash, purchased a delivery van for $ 22,000 cash, and issued common

Trava [24]

Answer:

B, $158,000

Explanation:

Given the following information about PULR in the current year;

Sale of land = $ 81,000 (Increase in cash balance)

Purchase of delivery van = $ 22,000 (decrease in cash balance)

Issued common stock = $ 97,000 (Increase in cash balance)

All cash transactions.

Net cash provided by investing activities = $ 81,000 - $ 22,000 + $ 97,000

= $ 158,000

7 0

3 years ago

Choose from the option list provided the procedure the auditor could implement to test the operating effectiveness of the intern

Vesnalui [34]

Answer:

Note: Missing word (list) are attached as picture below

1. To determine that all credit sales transaction of an entity are recorded

Procedure to implement: Match pre-numbered shipping documents with entries in sales journal.

2. To detect a failure to post invoice to customer account ledger

Procedure to implement: Trace Sales invoices to account receivable subsidiary ledger

3. To detect failure to invoice a shipment

Procedure to implement: Vouch bill of lading file to approved sales invoice

4. To ensure sales orders are properly authorized

Procedure to implement: Confirm sales orders were sent to the credit department

5. To determine goods sent to customers are based only on authorised sales order

Procedure to implement: Match bill of lading file to approved sales order

6. To verify the completeness of cash receipts for cash sales at a retail outlet

Procedure to implement: Observe consistency of employee's use cash registers and tapes

7. To ensure cash receipts are deposited

Procedure to implement: Compare daily cash receipts total with bank deposits

4 0

3 years ago

A negotiable instrument can function as a substitute for cash.

andreyandreev [35.5K]

1.A negotiable instrument can function as a substitute for cash.- TRUE

2. a time draft is payable at a definite future time. TRUE

3. promissory note payable to "bearer" is not negotiable. - FALSE (It is negotiable)

4. A certificate of deposit is a type of note. - TRUE

5. A signature can consist of a word, mark, or symbol. - TRUE

6.An instrument that promises to pay "in gold" can be negotiable.- FALSE ( Anything payable in the form of a commodity like gold cannot be negotiable)

5 0

3 years ago