In Macroland,there Is $1,000,000 in Currency That Can Either Be

question 22

Multiple Choice

In Macroland,there is $1,000,000 in currency that can either be held by the public or used by banks as reserves.The banks' desired reserve-deposit ratio is 10%.If the public of Macroland decides to hold less currency,decreasing the proportion they hold from 50% to 25%,the money supply in Macroland will

• A) increase.
• B) decrease.
• C) remain the same.
• D) may either increase or decrease.
• E) will increase initially,but then return to the original level.

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Definitions:

Units of Product

The quantity of product items or goods produced.

Actual Hours Worked

This refers to the total hours an employee has been physically present and working at their job within a specific period.

Direct Labor Costs

The wages and benefits paid to employees who are directly involved in the production of goods or services.

Variable Overhead Efficiency Variance

The difference between the actual variable overhead and the standard cost of variable overhead allocated for the actual production.