If Reserves Increase by $4 Million and the Required Reserve

question 100

Multiple Choice

If reserves increase by $4 million and the required reserve ratio is 8%,what is the resulting change in checkable deposits (or the money supply) ,assuming that there are no cash leakages and that banks hold zero excess reserves?

• A)$3.2 million
• B)$3.7 million
• C)$5 million
• D)$50 million

Identify the impact of interest rates on the value of bonds and securities before maturity.

Understand and compare the effects of different interest rates on investment growth over time.

Calculate the average annual rates of change for demographic or financial data.

Assess and compare the effectiveness of different savings and investment strategies over time.

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Definitions:

Refreezing

The final stage in the Lewin's change model where new behaviors or processes are solidified into the organization's culture after a change has been implemented.

Change Program

A planned initiative within an organization aimed at improving current processes or implementing major changes to systems, culture, or procedures to achieve specific goals.

Resistance to Change

The opposition or pushback by individuals or groups within an organization against modifications to established procedures, systems, or structures.

Adjustment Problems

Challenges and difficulties faced when adapting to new conditions, environments, or situations.