Ivan,a Russian Citizen,sells Several Hundred Cases of Caviar to a Restaurant

question 7

Multiple Choice

Ivan,a Russian citizen,sells several hundred cases of caviar to a restaurant chain in the United States.By itself,this sale

• A)increases U.S.net exports and decreases Russian net exports.
• B)increases U.S.net exports and has no effect on Russian net exports.
• C)decreases U.S.net exports and increases Russian net exports.
• D)decreases U.S.net exports and has no effect on Russian net exports.

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Definitions:

Deposits

Money placed into a financial institution for safekeeping, which can earn interest over time.

Excess Reserves

The amount of reserve funds that a bank holds beyond what is required by regulations, which can be loaned out or invested.

Actual Reserves

The sum of money a bank holds in its vault or with the central bank, ready to satisfy withdrawal requests or comply with regulatory obligations.

Required Reserves

The minimum amount of funds that a bank must hold in reserve against deposits, as mandated by monetary authorities.