When banks make new loans, the effect on reserves is the same as
A) holding excess reserves.
B) expanding capital.
C) purchasing securities.
D) acquiring deposits.
Correct Answer:
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Q19: The largest component of the money supply
Q20: Assume that excess reserves are $10 million,
Q21: If the required reserve ratio was 1,
Q22: If the ratio of net worth to
Q23: If the required reserve ratio is .5,
Q25: If a bank buys securities, its
A) net
Q26: The demand deposit multiplier is equal to
Q27: An initial deficiency in reserves of $20
Q28: The required reserve ratio is 10 percent,
Q29: If the required reserve ratio is decreased
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