macro economics

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  • Created by: amit
  • Created on: 21-04-15 21:22

1. If the actual reserve/deposit ratio equals 8% and the desired reserve/deposit ratio for this bank is 10%, the bank should:

  • make more loans in order to earn interest.
  • do nothing because this is a profitable situation.
  • stop making loans.
  • request that customers withdraw deposits from the bank.
  • send the extra reserves to the central bank.
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2. Frictional unemployment is:

  • the extra unemployment that occurs during periods of recession.
  • the unemployment that results when people retire or leave the labour force
  • short-term unemployment that is associated with the process of matching workers with jobs
  • the additional unemployment not captured in official statistics resulting from discouraged workers and the involuntary part-time workers.
  • long-term and chronic unemployment that exists even when the economy is producing at a normal rate.

3. A higher equilibrium Y and a lower equilibrium i are best explained by _____

  • an increase in the money supply
  • an increase in money demand
  • an increase in autonomous expenditure
  • an decrease in the money supply
  • an decrease in autonomous expenditure

4. An increase in the value of a currency relative to other currencies is called a(n):

  • devaluation
  • appreciation.
  • overvaluation
  • depreciation.
  • revaluation.

5. A decrease in the official value of a currency in a fixed-exchange-rate system is called a(n):

  • depreciation.
  • overvaluation.
  • devaluation
  • revaluation
  • appreciation.


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