If Reserves in the Banking System Increase by $200, Then

question 45

Multiple Choice

If reserves in the banking system increase by $200, then chequable deposits will increase by $500 in the simple model of deposit creation when the desired reserve ratio is ________.

• A) 0.04
• B) 0.25
• C) 0.40
• D) 0.50

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Definitions:

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Assumptive Close

A sales technique where the seller assumes that the buyer has already decided to purchase and wraps up the sale accordingly.

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Compliment Close

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