If the Required Reserve Ratio Is One-Third,currency in Circulation Is

question 77

Multiple Choice

If the required reserve ratio is one-third,currency in circulation is $300 billion,checkable deposits are $900 billion,and there is no excess reserve,then the M1 money multiplier is

• A)2.5.
• B)2.8.
• C)2.0.
• D)0.67.

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Definitions:

Production Level

The quantity of goods or services produced in a given time period by a company, sector, or economy.

Government Policy

Strategies and actions taken by a government to influence or control various aspects of its country's economy, society, or external relations.

Potentially Efficient

A state in which resources could be allocated in a way that maximizes output or welfare, but currently may not be.

Local Businesses

Independent or small-scale enterprises that operate within a specific geographical area, contributing to the local economy and often offering goods or services unique to that region.