When a $10 Check Written on the First National Bank

question 4

Multiple Choice

When a $10 check written on the First National Bank is deposited in an account at the Second National Bank,then

• A) the liabilities of the First National Bank decrease by $10.
• B) the reserves of the First National Bank increase by $10.
• C) the liabilities of the Second National Bank decrease by $10.
• D) the assets of Second National Bank decrease by $10.

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Definitions:

Midpoint Formula

A method used in economics to calculate the elasticity of demand or supply by taking the average of the initial and final prices and quantities.

Total Revenue

The total amount of money a company receives from its goods or services, calculated by multiplying the price per unit by the number of units sold.

Quantity Effect

The impact on total consumption or production as a result of a change in quantity, holding price constant.

Price Effect

The change in consumption resulting from a change in the price of a good or service, influencing consumer behavior.