The Total Amount of Required Reserves in the Banking System

question 51

Multiple Choice

The total amount of required reserves in the banking system is equal to the ________ the required reserve ratio and checkable deposits.

• A)sum of
• B)difference between
• C)product of
• D)ratio between

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Definitions:

MRTS

Marginal Rate of Technical Substitution; the rate at which one input can be reduced for every increase in another input while maintaining the same level of output.

Capital

Financial assets or the financial value of assets, such as cash and other tangible assets, used in operations to generate income or profit.

Labor

Work, especially physical, manual or hard work, performed by people in exchange for payment.

Production Costs

The total expense incurred in manufacturing goods or providing services, including raw materials, labor, and overhead expenses.