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Bond [772]
2 years ago
10

Suppose that the banking system has $100,000 in total deposits and actual reserves on hand in the amount of $35,000. If the lega

lly required reserve ratio is 20 percent, the maximum amount the banking system can add to the money supply is:
Business
1 answer:
Wewaii [24]2 years ago
8 0

Answer:

$75,000

Explanation:

If the legally required reserve ratio is 20%, then the money multiplier = 1 / 20% = 5.

Since the bank's excess reserves are $15,000 (= $35,000 - $20,000), the total amount of money it can add to the money supply = excess reserves times money multiplier = $15,000 x 5 = $75,000

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Answer:

acquisition

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Explanation:

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Merger is when two or more firms comes together to form a single entity.

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Firms also merge in order to increase their financial capacity. This will enable them to be able to finance their business operations. They are also able to increase their asset base as a result of the merger.

4 0
2 years ago
Suppose investment is $1,100 billion, private saving is $1,050 billion, and capital inflow from abroad is $100 billion. Solve th
Sauron [17]

Anoveoswer:

The government deficit is $150 billion

Explanation:

Current Account (CA)  = Savings(S) -Investment(I).

Current account (CA)  is also conventionally defined as (X-M) (value of exports – value of imports) + Net income from abroad. (R)

CA = (X-M) + (R)

In this case CA= $1050 billion - $1100 billion

                      CA= -$50 billion

Therefore CA = (X-M) + (R)

           - $50 billion = x + $100 billion

       X-M= -$100 billion + -$50 billion=  -$150 billion

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3 years ago
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vodka [1.7K]

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3 years ago
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romanna [79]

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5 0
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I had this on my test

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