Use the Following to Answer Questions

question 92

Multiple Choice

Use the following to answer questions:
-(Scenario: Assets and Liabilities of the Banking System) Look at the scenario Assets and Liabilities of the Banking System. If the reserve ratio is 9% and the banking system does NOT want to hold excess reserves, how much more can be added to the money supply?

• A)about $667,000
• B)about $111,000
• C)$250,000
• D)$1 million

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Definitions:

Tariff

A tax imposed by a government on goods and services imported from other countries, often used to protect domestic industries from foreign competition.

Government Revenues

The total money received by the government from taxes as well as non-tax sources like charges and fees.

Total Revenue

The total amount of money generated by the sale of goods or services before any expenses are subtracted.

Domestic Producers

Companies or individuals that produce goods and services within their home country.