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Assume that the desired reserve ratio is 10 percent and there are no excess reserves in the banking system.Also, suppose that the full-employment, non-inflationary level of GDP in this closed, private economy is $1,200. Refer to the above information.An interest rate of 2 percent is not sustainable because:
Superego
In Freud’s structural model, the part of personality that represents society’s values.
Hypnosis
A trance-like state of altered consciousness, usually induced to access deeper levels of the mind, for therapeutic purposes.
Psychological Defense Mechanisms
Strategies used unconsciously by individuals to protect themselves from anxiety and to manage reality and internal conflict.
Distorting Reality
The alteration or manipulation of perceived reality, often to mislead or deceive.
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