Liquid Asset Ratio Describes

question 18

Multiple Choice

Liquid asset ratio describes:

• A)the minimum ratio of liquid assets to total equity set by the central bank.
• B)the minimum ratio of liquid assets to total liabilities set by the central bank
• C)the minimum ratio of liquid assets to total assets set by the central bank.
• D)None of the listed options are correct.

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Definitions:

Long-run Equilibrium

A state in economic analysis where all inputs can be adjusted, market supply meets demand, and all firms in the market earn normal profit, indicating no entry or exit from the industry.

Low Point

Refers to the lowest level or value that something can reach, often used in the context of prices, rates, or economic indicators.

Average Total Cost Curve

A graphical representation showing how the total cost per unit of output varies with the level of output, typically U-shaped due to economies and diseconomies of scale.

Long-run Equilibrium

A state in which all factors of production and costs are variable, allowing firms to make adjustments, resulting in no economic profit in perfect competition.