In Macroland There Is $12,000,000 in Currency

question 30

Multiple Choice

In Macroland there is $12,000,000 in currency. The public holds half of the currency and banks hold the rest as reserves. If banks' desired reserve/deposit ratio is 12.5 percent, deposits in Macroland equal ________ and the money supply equals ________.

• A)$48,000,000; $75,000,000
• B)$54,000,000; $54,000,000
• C)$48,000,000; $54,000,000
• D)$96,000,000; $96,000,000

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Definitions:

Production Technique

A method or process used in the creation of goods or services, often involving tools, machinery, and technology.

In Season

Refers to the time of year when certain goods, particularly agricultural products, are readily available and at their peak quality.