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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