A Simple Deposit Multiplier Equal to Four Implies a Required

question 156

Multiple Choice

A simple deposit multiplier equal to four implies a required reserve ratio equal to

• A)100 percent.
• B)50 percent.
• C)25 percent.
• D)0 percent.

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Definitions:

Cash

Money in the form of currency that is used to conduct transactions.

Accumulated Depreciation

The total amount of depreciation for a fixed asset that has been charged to expense since that asset was acquired and put into use.

Fair Market Value

The estimated price at which an asset would change hands between a willing buyer and a willing seller, with both parties having reasonable knowledge of all relevant facts and neither being compelled to buy or sell.

Accounts Payable

Accounts payable are liabilities or money owed by a company to its creditors for goods and services received.