Suppose That from a New Checkable Deposit,First National Bank Holds

question 10

Multiple Choice

Suppose that from a new checkable deposit,First National Bank holds two million dollars in vault cash,eight million dollars on deposit with the Federal Reserve,and nine million dollars in excess reserves. Given this information,we can say First National Bank has ________ million dollars in required reserves.

• A)one
• B)two
• C)eight
• D)ten

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Definitions:

Variable Labor

The aspect of labor costs that varies with the level of production or business activity within a given period.

Fixed Capital

Refers to the long-term assets used in production, including buildings, machinery, and equipment, which are not frequently replaced.

Total Variable Cost

The total of expenses that change in proportion to the activity or production level of a business.

Economic Costs

The total cost of choosing one action over another, including both explicit and implicit costs.