In the Money and Credit Expansion Process,when R = the Required

question 4

Multiple Choice

In the money and credit expansion process,when r = the required reserve ratio,the total change in checkable deposits is equal to the initial change in excess reserves

• A)multiplied by r
• B)plus the change in required reserves
• C)divided by 1/r
• D)multiplied by 1/r
• E)divided by the change in required reserves

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Definitions:

Basis

The amount of an investment in property for tax purposes; used to calculate gain or loss on a sale or other disposition of the property.

Gain Recognized

The profit realized from the sale or exchange of an asset, which must be reported for tax purposes.

Involuntary Conversion

Involuntary conversion is the process whereby property is destroyed, stolen, condemned, or disposed of under the threat of condemnation, and the owner receives compensation or insurance recovery.

Reinvested

The act of using dividends, interest, or profits from an investment to purchase additional shares or units of that investment.