Assume That the Required Reserve Ratio Is 10

question 9

Multiple Choice

Assume that the required reserve ratio is 10%. An increase of $1,000 in the banking system's excess reserves may result in a total expansion of new deposits for the banking system as a whole by as much as

• A) $1,000.
• B) $9,000.
• C) $10,000.
• D) $100,000.

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Definitions:

Marginal Utility

The added satisfaction or utility a consumer gains from consuming an additional unit of a good or service.

Consumer Surplus

The difference between what consumers are willing to pay for a good or service and what they actually pay, representing the benefit to consumers.

Marginal Utility

Marginal Utility is the additional satisfaction or utility received by consuming one more unit of a good or service.

Action Figures

Small, collectible figures often representing characters from movies, comic books, or video games, popular with both children and collectors.