Answer: B. 1/R, where R represents the reserve ratio for all banks in the economy.
Explanation:
The Money Multiplier is the money that Banks generate given a certain RESERVE REQUIREMENT/RATIO.
A Reserve Requirement is money that the Central Bank requires that Banks do not loan out and instead keep in reserve.
For example, if the reserve rate is 10% and a bank has $10 they can only loan out $9.
Assuming they loan out $9 then they created $19 in the economy because their customers still own the original $10 but now they have also given loans of $9. The people who take the loans then deposit it in another bank. That bank would keep $0.90 in reserve and loan out $8.10 meaning that $27.10 now exists in the economy.
The process goes on and on until it gets to $100.
A simpler way to get to the final figure is to divide 1 by the reserve requirement = 1/r which is the money multiplier.
Using the above example, that would be 1/0.1 which is 10.
Multiplying this 10 by the initial deposit of $10 will give you that same $100.
Answer:
<em>Carlton files a petition in bankruptcy. One of the goals of bankruptcy law with respect to a debtor is </em><em>to </em><em>provide a fresh start, free from creditors' claims </em>
Answer:portfolio Weight of A =0.6118; portfolio Weight of B=0.3882
Explanation:
stock A Investment = Number of shares x market value
=130 x 40 = $5200
stock B investment =Number of shares x market value
110 x 30 = $3,300
Total Investments= $5200
+ $3,300 = $8,500
portfolio Weight = stock Investment / Total investment
portfolio Weight of A= 5200/ 8,500 =0.6118
portfolio Weight of B = 3,300 / 8,500 =0.3882
Answer: Economic Surplus : $12
Explanation: Economic surplus is the difference between benefit and cost.
In this case, since he is working as a math tutor, he will get $45, there is no other cost. But if he goes for a movie, he will have to spend $12 on movie, which is the cost he needs to bear. The economic surplus is $12 which is not spent on the movie and worked as a math tutor.
Answer: reciprocity
Explanation: In simple words, reciprocity refers to the agreement in which two parties exchange goods or services in such a way that both of them will gain benefit from such agreement.
In business it can achieved in many ways, for example by combining the efforts and resources or by providing each other some service in exchange for service from the other side.
In the given case, Jason made a deal with dodge to provide service to him in exchange for service by him. Hence we can conclude that the given case depicts reciprocity.
