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

question 70

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 that the Bank of Tazi changes the reserve requirement to 3 percent.Assuming that the banks still want to hold the same percentage of excess reserves what is the value of the money supply after banks adjust to the change in the reserve requirement?

• A)9,375 million tazes
• B)10,000 million tazes
• C)12,500 million tazes
• D)None of the above is correct to the nearest million tazes.

---

Definitions:

Thyroid Gland

An endocrine gland in the neck that produces hormones regulating the body's metabolic rate, heart and digestive function, muscle control, brain development, and bone maintenance.

Poison

A substance that is capable of causing illness or death when introduced into the body.

Sugar

A sweet-tasting, soluble substance obtained from plants like sugar cane and sugar beet, used primarily as a sweetener in food and beverages.

Combining Form

In linguistics, especially in the formation of compound words, a morpheme that is used in combination with another form to create a new word or term.