Answer: $32000
Explanation:
The required reserves will be calculated as:
= Checkable deposit × Legal reserve ratio
= $80000 × 20%
= $16000
Excess reserves = $16000
Actual reserves will now be:
= Required reserves + Excess reserves
= $16,000 + $16,000
= $32,000
Answer:
b. how much wealth people want to hold in liquid form.
Explanation:
Money demand refers to the amount of liquid assets or wealth, which can be quickly converted to cash, an individual desires hold at a particular point in time, which enables the individual to easily carry out transactions such as exchange of goods and services. It is simply referred to as the desire of people to hold cash. It does include illiquid physical assets that cannot be quickly converted to cash. It includes cash or bank deposits.
Your answer should be 90 percent.
Answer:
the substitution effect only
Explanation:
The Substitution effect occurs when there is an increase in the level of the price so the people goes towards the cheaper products who are best alternative due to which the demand of that goods would drop
Here in the question it is mentioned that if the good contains a less price so would consumer more due to the Substitution effect only
Hence, the same is to be considered
