The Banking System Currently Has $10 Billion of Reserves, None

question 197

Multiple Choice

The banking system currently has $10 billion of reserves, none of which are excess. People hold only deposits and no currency, and the reserve requirement is 10 percent. If the Fed raises the reserve requirement to 20 percent and at the same time buys $1 billion worth of bonds, then by how much does the money supply change?

• A)It falls by $45 billion.
• B)It falls by $52 billion.
• C)It falls by $55 billion.
• D)None of the above is correct.

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The act of registering, selling, or using a domain name with the intent of profiting from the goodwill of someone else's trademark.

Trademark

A word, symbol, or phrase that has been legally registered or officially established through usage to signify a company or product.

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The process of converting analog audio signals into digital data for manipulation, storage, or reproduction.