1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
solmaris [256]
4 years ago
7

On a certain date, the banking system had $40 billion in excess reserves. The legally required reserve ratio was 20 percent.

Business
1 answer:
MariettaO [177]4 years ago
8 0

Answer:

The answer is $200 billion

Explanation:

Legal reserve ratio is the minimum fraction of customers' deposits that the banks are required to keep by law as cash. This minimum ratio is determined by Central banks while money supply is the total amount of money in circulation at a particular time.

Legal reserve is 100% ÷ 20%

= 5

Therefore, the banking system as a whole could increase the money supply by $200 billion($40 billion x 5)

You might be interested in
What are six advantages of teen entrepreneurs?
astraxan [27]
<span><span>Risks is lower
</span><span>Family and friends support
</span><span>Easier to allocate time resources 
</span><span>Hiring young employees
</span><span>Lower costs
</span>Business innocence</span>
5 0
3 years ago
Using the taylor rule, if the current inflation rate equals the target inflation rate and real gdp equals potential gdp, then th
Marrrta [24]

Using Taylor's rule, if the current inflation rate equals the target inflation rate and real GDP equals potential GDP, then the target federal funds rate equals the current inflation rate plus the real equilibrium federal funds rate.

Inflation can be defined as an increase in prices, which can be translated as a decrease in purchasing power over time. The rate of decline in people's purchasing power can be reflected in the increase in the average price of a selected basket of goods and services over a period of time. An increase in price, which is often expressed as a percentage, means that one unit of currency is effectively buying less than it did in the previous period. Inflation can be contrasted with deflation, which occurs when prices fall and people's purchasing power increases.

You can learn more about inflation here brainly.com/question/28190771

#SPJ4

3 0
2 years ago
If the price level rose from 131 to 157 but economic output remained the same, real gdp would:______
Arlecino [84]

If the price level rose from 131 to 157 but economic output remained the same, real GDP would increase.
The price level has increased and the output is constant then the nominal GDP would increase.

  • The term "Gross Domestic Product," or GDP, refers to the total monetary worth of all finished products and services produced (and marketed) inside a nation within a specific time period (typically 1 year). Purpose. GDP stands for "Gross Domestic Product" and reflects the total monetary worth of all finished products and services produced (and sold on the market) inside a nation during a specific period of time. GDP is the most often used indicator of economic activity (typically 1 year). Purpose. The most often used indicator of economic activity is the GDP.

To know more about GDP visit:
https://brainly.in/question/48232765
#SPJ4

8 0
2 years ago
Investors select a stock based on the cash they expect to receive from that stock. that cash comes in the form of?
mylen [45]

Investors select a stock based on the cash they expect to receive from that stock. that cash comes in the form of a and b.

Investors are usually different from traders. Investors invest capital for long-term gains, while traders buy and sell securities repeatedly in pursuit of short-term gains. Investors typically generate income by investing capital in either stocks or debt.

So how does an investor choose which stocks to buy?He has two main investment styles: active and passive. Active investors try to outperform the market by buying stocks that they believe are undervalued, with the intention of selling when the stock price rises.

Stock pick. An active portfolio management approach that focuses on a favorable selection of specific stocks rather than broad asset allocation.

Learn more about stock here: brainly.com/question/25818989

#SPJ4

The question is incomplete. Please read below to find the missing content.

Investors select a stock based on the case they expect to receive from that stock. That cash comes in the form of ____.

a. Dividends

b. The future sales price.

c. Interest payments.

d. Commissions.

7 0
2 years ago
Which category of cost includes insurance and utilities
Nata [24]

Answer:

Administrative Cost

Explanation:

Administrative cost refers to the cost used in directing and controlling a firm, corporation or organisation. These cost includes salary and wages of employee, insurance, depreciation, postage, stationery, rent, etc.

It is sometimes refers to as general cost. It is used in the day to day running of the business, but not directly attributable to any production process. These cost can not be categorized as either financing or distribution cost. Hence, it falls under administrative cost.

8 0
3 years ago
Other questions:
  • How can international trade agreements lead to economic growth
    7·1 answer
  • A factor of production that is produced in order to produce something else is called
    13·1 answer
  • Is there a conflict between maximizing shareholder wealth and never paying bribes when doing business abroad? If so, how might y
    12·1 answer
  • When all firms and potential firms in a market have the same cost curves, the long-run equilibrium of a competitive market will
    15·1 answer
  • In service learning, you __________. Group of answer choices go through short-term, on-the-job training for pay or academic cred
    13·1 answer
  • Sysco Corporation, formed in 1969, is the largest global distributor of food service products, serving over 500,000 restaurants,
    10·1 answer
  • What is Ministry of Freedom ?
    8·1 answer
  • Gregory knew that he was going to have to pay a premium for buying a home in a certain area but was determined to do so because
    14·1 answer
  • Neil is developing his marketing strategy. Which of these is NOT a requirement Neil has to follow based on the Telephone Consume
    14·1 answer
  • A bill's supporters in the house of representatives generally prefer ________ while opponents generally prefer ________.
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!