Simulation Is Used for Several Reasons, Including

question 2

Multiple Choice

Simulation is used for several reasons, including

• A) model development is a fast process
• B) it is inexpensive
• C) the models are usually simple
• D) it can handle large and complex real-world problems
• E) it always generates optimal solutions

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Definitions:

Excess Reserves

The reserves held by a bank in excess of the minimum reserve requirements set by central banking authorities.

Required Reserves

The minimum amount of reserves that banks are required to hold by law, as a safeguard against bank runs.

Demand Deposits

Bank account balances that can be withdrawn on demand without any notice, such as in checking accounts.

Credit Availability

The ease with which individuals and businesses can obtain loans or credit, often influenced by interest rates and economic policies.