The Upward Trend in the Currency-Deposit Ratio During 1994-2007 Can

question 120

Multiple Choice

The upward trend in the currency-deposit ratio during 1994-2007 can be explained by

• A)the increased holdings of U.S. currency by foreigners.
• B)bank panics.
• C)a drop in the rate of interest paid on checking deposits.
• D)high taxes and illegal activities.

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Definitions:

Stock Price

The market value of a single share of a company's stock.

Marginal Tax Rate

The rate at which the next dollar of taxable income will be taxed, indicating the tax bracket into which the last dollar of income falls.

Dividend Payout

The portion of a company's earnings that is distributed to its shareholders as dividends.

Capital Gains

The profit earned from the sale of assets or investments that have increased in value over the time they were held.