Scenario 11-2. The Monetary Policy of Tazi Is Controlled by the Country's

question 102

Multiple Choice

Scenario 11-2.
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 11-2. Suppose the Bank of Tazi loaned the banks of Tazi 10 million tazes. Suppose also that both the reserve requirement and the percentage of deposits held as excess reserves stay the same. By how much would the money supply change?

• A) 250 million tazes
• B) 200 million tazes
• C) 125 million tazes
• D) None of the above is correct.

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Definitions:

Glomerular Filtration

The process by which the kidneys filter blood, removing excess waste and fluids to form urine.

Ureters

Tubes that transport urine from the kidneys to the bladder, part of the urinary tract system.

Urethra

The tube that conducts urine from the bladder to the outside of the body in both males and females.

Glomerular Capsule

A cup-like sac at the beginning of the tubular component of a nephron in the kidney that performs the first step in the filtration of blood to form urine.