If loans are 300,000 . checkable deposits are 600,000 . and the required reserve ratio is 40 percent, then excess reserves are:
a. 360,000.
b. 240,000.
c. 120,000.
d. 60,000.
e. 30,000.
QUESTION 2Which of the following statements is true?
a. There is no single correct strategy for economic growth and development.
b. In general, GDP per capita is highly correlated with alternative quality of life measures.
c. The World Bank is affiliated with the United Nations and makes long-term low-interest loans to LDCs.
d. All of these.
QUESTION 3In the long run, wages and prices are considered to be:
a. fixed.
b. sticky.
c. flexible.
d. unstable.
QUESTION 4Imagine that Odyssey National is a brand new bank, and that its required reserve ratio is 10 percent. If it accepts a 1,000 deposit, then its excess reserve balance will be:
a. 0.
b. 90.
c. 100.
d. 900.
e. 910.
QUESTION 5Which of the following statements is true?
a. A less developed country (LDC) is a country with a low GDP per capita, low levels of capital, and uneducated workers.
b. The vicious circle of poverty exists because GDP must rise before people can save and invest.
c. LDCs are characterized by rapid population growth and low levels of investment in human capital.
d. All of these.
QUESTION 6The long-run aggregate supply curve (LRAS) is:
a. a vertical curve that relates the level of real GDP produced to the price level in the long run.
b. an upward sloping curve that relates the level of real GDP produced to the price level in the long run.
c. an infinite curve that relates the level of real GDP produced to the price level in the long run.
d. none of the above are true.
QUESTION 7Imagine that Odyssey National is a brand new bank, and that its required reserve ratio is 10 percent. If it accepts a 1,000 deposit, then its required reserves balance will be:
a. 0.
b. 90.
c. 100.
d. 900.
e. 910
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