At One Time, the Country of Islandtopia Had No Banks

question 9

Multiple Choice

At one time, the country of Islandtopia had no banks, but had currency of $10 million. Then a banking system was established with a reserve requirement of 20 percent. The people of Islandtopia now keep half their money in the form of currency and half in the form of bank deposits. If banks do not hold excess reserves, how much currency do the people of Islandtopia now hold?

• A) $2 million
• B) $5 million
• C) $9 million
• D) $12 million

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Definitions:

Collectivist Culture

A culture that emphasizes the needs and goals of the group over the needs and desires of the individual.

Individual Achievement

Personal accomplishments or success achieved through one's own efforts and skills, measured by personal standards or external recognition.

Attribution Approach

A theory that explores how individuals interpret events and how this relates to their thinking and behavior, particularly how people attribute causes to actions and outcomes.

Achievement Goals

Objectives related to accomplishing tasks or achieving high standards of performance, which can motivate individuals or determine their approach to tasks.