Scenario 11-1. The Monetary Policy of Namdian Is Determined by the Namdian

question 38

Multiple Choice

Scenario 11-1.
The monetary policy of Namdian is determined by the Namdian Central Bank. The local currency is the dia. Namdian banks collectively hold 100 million dias of required reserves, 25 million dias of excess reserves, 250 million dias of Namdian Treasury Bonds, and their customers hold 1,000 million dias of deposits. Namdians prefer to use only demand deposits and so the money supply consists of demand deposits.
-Refer to Scenario 11-1. Assuming the only other item Namdian banks have on their balance sheets is loans, what is the value of existing loans made by Namdian banks?

• A) 625 million dias
• B) 875 million dias
• C) 1,125 million dias
• D) None of the above is correct.

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Definitions:

Major Depressive Disorder

A mental health condition marked by persistent feelings of sadness, hopelessness, and loss of interest, often accompanied by physical symptoms.

Debilitating

Debilitating describes a condition or illness that severely affects one's strength or ability to carry out day-to-day activities.

Hospitalization

The process or period of receiving medical treatment in a hospital.

Dissociative Disorder

A psychological condition characterized by a disconnection and lack of continuity between thoughts, memories, surroundings, actions, and identity.