If Bank Reserves Are 200,the Public Holds 400 in Currency,and

question 116

Multiple Choice

If bank reserves are 200,the public holds 400 in currency,and the desired reserve-deposit ratio is 25%,deposits are ________ and the money supply is ________.

• A) 200;600
• B) 400;800
• C) 600;1,000
• D) 800;1,200
• E) 2,400;2,800

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Definitions:

Stock Market

A public market for the trading of company stock and derivatives at agreed prices.

Future Earnings

Projected profits or income a company expects to generate in future periods.

Prior Period Adjustment

Corrections of errors in previously published financial statements not related to the current period.

Income Statement

A report detailing a company’s financial activities, including income and expenditures, over a designated accounting timeframe.