ECO/372T Principles Of Macroeconomics The Latest Version A+ Study Guide **********************************************
ECO 372T Entire Course Link http://www.onlinehelp123.com/eco-372 ********************************************** ECO 372T Wk 5 - Apply: Quiz (Advanced analysis) Assume the equation for the total demand for money is L = 0.4Y + 80 − 4i, where L is the amount of money demanded, Y is gross domestic product, and i is the interest rate. If gross domestic product is $200 and the interest rate is 10 percent, what amount of money will society want to hold? Multiple Choice • 144. • 100. • 120. • 160. • 200.
Item in Balance Sheet Amount 1) Treasury Deposits $7 2) Reserves of Commercial Banks 31 3) Federal Reserve Notes 275 4) Loans to Commercial Banks 3 5) All Other Assets 66 6) Securities 241 7) All Other Liabilities and Net Worth 7
The table shows items and figures taken from a consolidated balance sheet of the 12 Federal Reserve Banks. All figures are in billions of dollars. In this balance sheet, there would be assets of Multiple Choice • $317 billion. • $309 billion. • $341 billion. • $310 billion.
A reserve requirement of 10 percent means a bank must have at least $300 of reserves if its checkable deposits are Multiple Choice • $3,000. • $30. • $300. • $30,000.
Suppose a credit union has checkable deposits of $400,000 and the legal reserve ratio is 10 percent. If the institution has excess reserves of $8,000, then its actual reserves are Multiple Choice • $48,000. • $32,000. • $8,000. • $40,000.
If nominal GDP is $800 billion and, on average, each dollar is spent four times in the economy over a year, then the quantity of money demanded for transactions purposes will be Multiple Choice • 3,200 • 200 • 800 • 600 • 400
Suppose a commercial bank has checkable deposits of $60,000 and the legal reserve ratio is 25 percent. If the bank's required and excess reserves are equal, then its actual reserves Multiple Choice
• • • •
are $30,000. are $15,000. are $1,500,000. cannot be determined from the given information.
Answer the question based on the following information for a bond having no expiration date: bond price = $1,000; bond fixed annual interest payment = $100; bond annual interest rate = 10 percent. If the price of this bond increases to $1,250, the interest rate will Multiple Choice • fall to 1.25 percent. • rise to 12.5 percent. • rise to 18 percent. • fall to 8 percent. • fall to 2.5 percent.
A commercial bank buys a $20,000 government security from a securities dealer. The bank pays the dealer by increasing the dealer's checkable deposit balance by $20,000. The money supply has Multiple Choice • increased by $20,000. • decreased by $20,000. • not been affected. • increased by $20,000 multiplied by the reserve ratio.
Assume that Smith deposits $600 in currency into her checking account in the XYZ Bank. Later that same day, Jones negotiates a loan for $1,200 at the same bank. In what direction and by what amount has the supply of money changed? Multiple Choice • increased by $1,200 • decreased by $600 • increased by $1,800 • increased by $600
Refer to the graph. If the initial equilibrium interest rate was 5 percent and the money supply increased by $200 billion, then the new interest rate would be
Multiple Choice • 3 percent. • 1 percent. • 2 percent. • 4 percent.