Scenario 29-2. The Monetary Policy of Tazi Is Controlled by the Country's

question 121

Multiple Choice

Scenario 29-2.
The Monetary Policy of Tazi is controlled by the country's central bank known as the Bank of Tazi.The local unit of currency is the taz.Aggregate banking statistics show that collectively the banks of Tazi hold 300 million tazes of required reserves,75 million tazes of excess reserves,have issued 7,500 million tazes of deposits,and hold 225 million tazes of Tazian Treasury bonds.Tazians prefer to use only demand deposits and so all money is on deposit at the bank.
-Refer to Scenario 29-2.Assume that banks desire to continue holding the same ratio of excess reserves to deposits.What is the reserve requirement and the reserve ratio for Tazian Banks?

• A)5 percent,8 percent
• B)4 percent,8 percent
• C)4 percent,5 percent
• D)None of the above is correct.

---

Definitions:

Specific Factor

A particular element or aspect that contributes to a result or situation.

Persuasive Messages

Communications designed to influence the attitudes, beliefs, or actions of others through argument, reasoning, or appeal.

Jargon

Specialized language used in particular professional or group contexts that may not be understood by outsiders.

Vivid Language

Descriptive and colorful language that helps to paint a detailed picture in the reader's or listener's mind.