If Checking Deposits Increase by $6,000 After All Rounds of the Money-Creation

question 47

Multiple Choice

If checking deposits increase by $6,000 after all rounds of the money-creation process when the Fed buys $1,200 worth of U.S.government securities,the maximum value of the required reserve ratio is

• A)5
• B)0.75
• C)0.2
• D)1.2
• E)1.0

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Definitions:

Budget Plan

A detailed outline of expected income and expenses over a given period, helping individuals or organizations manage their finances.

kWh

Stands for kilowatt-hour and is a unit of energy representing one kilowatt of power expended for one hour, commonly used to measure electricity consumption.

Electricity Charge

The cost incurred from consuming electric power, reflected as part of a utility bill.

Water Meter

A device installed to measure the volume of water usage in residential, commercial, or industrial properties.