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shepuryov [24]
4 years ago
10

Suppose that the reserve requirement for checking deposits is 16 percent and that banks do not hold any excess reserves. If the

Fed sells $2 million of government bonds, the economy's reserves by $ million, and the money supply will by $ million.
Business
1 answer:
forsale [732]4 years ago
5 0

Answer:

Decreases by $2 million; Money supply decreases by $12.5 million

Explanation:

Given that,

Required reserve ratio = 16 percent

Government bonds sold by Fed = $2 million

Therefore, the economy's reserve decreases by:

= Change in money supply × Required reserve ratio

= $12.5 million × 0.16

= $2 million.

Money multiplier = 1 ÷ Required reserve ratio

                            = 1 ÷ 0.16

                            = 6.25

Money supply decreases by:

= Money multiplier × Decline in reserves

= 6.25 × $2 million

= $12.5 million

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Explanation:

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3 years ago
Cáchs tính giá nhập kho trong nguyên lí kê stoans
netineya [11]

Answer:  truy cập vào link sau

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Explanation:

8 0
3 years ago
The supply of seats for a psychology class at 10 a.m. is the same as the supply of seats for the same class at 2pm LO5 MO1 There
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Answer:

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Explanation:

The supply of seats for the psychology class at 10 a.m is the same as the class at 2 a.m. But there is a surplus of seats at 2 a.m class and shortage of seats at 2 p.m class.  

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