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

question 73

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.Suppose the Bank of Tazi purchased 50 million tazes of Tazian Treasury Bonds from the banks.Suppose also that both the reserve requirement and the percentage of deposits held as excess reserves stay the same.By how much does the money supply change?

• A)625 million tazes
• B)1,000 million tazes
• C)1,250 million tazes
• D)None of the above is correct.

---

Definitions:

Amphiarthrosis

A type of joint in the human body that allows for limited movement, contributing to stability and support, such as the vertebrae in the spine.

Diarthrosis

A movable joint; another word for synovial.

Breast Bone

Also known as the sternum, a long flat bone located in the central part of the chest, connecting the rib bones and supporting the collar bone.

Axial Skeleton

The central part of the skeleton, comprising the skull, vertebral column, ribs, and sternum, providing support and protection for the body's vital organs.