If There Are No Excess Reserves in the Banking System

question 92

Multiple Choice

If there are no excess reserves in the banking system and the Fed lowers the required reserve ratio,it follows that banks will now have __________,which they can use to extend loans and create new __________.

• A) positive excess reserves; checkable deposits
• B) negative excess reserves; currency
• C) positive excess reserves; currency
• D) more vault cash; checkable deposits
• E) none of the above

Understand the tax implications of asset disposal and how depreciation methods affect tax calculations.

Identify the limitations of the payback method and how it ranks investment proposals.

Appreciate the significance of time value of money in evaluating investment decisions and savings.

Understand the process and benefits of post-audits in capital investment projects.

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Definitions:

Internet Transactions

Business or financial transactions conducted online, typically involving the buying and selling of goods or services.

Federal Statutory Law

Laws enacted by the United States Congress that apply to the entire country and are recorded in the United States Code.

Adversarial System

A legal system where two opposing parties present their arguments and evidence to a neutral judge or jury, which decides the outcome.

Litigation

The process of taking legal action in court to enforce or defend a right, resulting in a judge or jury making a decision on the case.