If the Reserve Ratio Is 0

question 83

True/False

If the reserve ratio is 0.3 and a deposit of $1,000 is made to the bank, the bank can lend out $700.

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Definitions:

Total Production

The aggregate amount of goods or services produced by an entity during a specific period.

Marginal Revenue (MR)

The increase in income resulting from the sale of one extra unit of a good or service.

Marginal Cost (MC)

The growth in overall expenses incurred from the manufacture of an extra unit of a product or service.

Additional Factory

A supplementary manufacturing facility established by a company to increase production capacity.