Answer the Question on the Basis of the Following Consolidated

question 178

Multiple Choice

Answer the question on the basis of the following consolidated balance sheet of the commercial banking system.Assume that the reserve requirement is 20 percent.All figures are in billions and each question should be answered independently of changes specified in all preceding ones. $\begin{array}{c}\begin{array}{lll}\quad\quad\quad\underline{\text { Assets}}\\\text { Reserves}\\\text { Securities}\\\text { Loans}\\\text { Property} \end{array}\begin{array}{l}\\\$ 200 \\300 \\500 \\400 \end{array}\begin{array}{lll}\quad\quad \underline{\text { Liabilities \& Net Worth }}\\\text { Checkable Deposits}\\\text { Stock Shares}\\\\\\\end{array}\begin{array}{lll}\\\$1,000\\400\\\\\\\end{array}\end{array}$



Refer to the given data.Suppose the Fed wants to reduce the money supply by $200 billion to drive up interest rates and dampen inflation.To accomplish this,it could increase the reserve requirement from 20 percent to:

• A) 22 percent.
• B) 25 percent.
• C) 30 percent.
• D) 33 percent.

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Definitions:

Perspiring

The process of sweating, a natural way for the body to regulate its temperature.

Oral Temperature

The body temperature as measured in the mouth with a thermometer, reflecting the core body temperature and used in assessing health status.

Fever

Elevated body temperature

Physical Activity

Any bodily movement produced by skeletal muscles that require energy expenditure, contributing to health and fitness.