Use the Following to Answer Questions

question 200

Multiple Choice

Use the following to answer questions :
Scenario: Money Creation
The reserve requirement is 20%. Leroy receives $1,000 as a graduation present and deposits the money in his checking account. The bank does NOT want to hold excess reserves.
-(Scenario: Money Creation) Look at the scenario Money Creation. By how much did the monetary base change?

• A)$0
• B)$800
• C)$1,000
• D)$4,000

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Definitions:

Point A

A specific position or location often referenced in economic models or graphs to illustrate a particular scenario or outcome.

Opportunity Cost

The budgetary repercussion of passing on the subsequent top pick when decisions are taken.

Point A

A specific location or position in any defined space or context, often used in diagrams to represent particular points in economic models or graphs.

Point B

Often used in graphs or models to denote a specific location, point, or situation being analyzed or referenced.