In Macroland,there Is $10,000,000 in Currency

question 43

Multiple Choice

In Macroland,there is $10,000,000 in currency.The public holds half of the currency and banks hold the rest as reserves.If the banks' desired reserve-deposit ratio is 10%,deposits in Macroland equal ________ and the money supply equals ________.

• A) $50,000,000;$60,000,000
• B) $55,000,000;$55,000,000
• C) $50,000,000;$55,000,000
• D) $100,000,000;$100,000,000
• E) $100,000,000;$110,000,000

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Definitions:

Deposits In Transit

Deposits in transit are amounts that have been received and recorded by a company, but have not yet been processed or acknowledged by the bank.

Deductions

Specific amounts subtracted from gross income to reduce the taxable income, including allowances, expenses, and exemptions.

Voucher Register

A journal that records all vouchers once they are approved, which includes amounts to be paid, to whom, and the accounts affected.

Approved Vouchers

Documents that have been verified and authorized for payment because they accurately reflect the goods or services received.