PracticeQuestion_CH18-1 - Name: _ Date: _ 1. In the United...

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Name: __________________________ Date: _____________ 1. In the United States, the money supply is determined: A) only by the Fed. B) only by the behavior of individuals who hold money and of banks in which money is held. C) jointly by the Fed and by the behavior of individuals who hold money and of banks in which money is held. D) according to a constant-growth-rate rule. 2. Bank reserves equal: A) gold kept in bank vaults. B) gold kept at the central bank. C) currency plus demand deposits. D) deposits that banks have received but have not lent out. 3. In a 100-percent-reserve banking system, if a customer deposits $100 of currency into a bank, then the money supply: A) increases by $100. B) decreases by $100. C) increases by more than $100. D) remains the same. 4. In a system with fractional-reserve banking: A) all banks must hold reserves equal to a fraction of their loans. B) no banks can make loans. C) the banking system completely controls the size of the money supply.
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This note was uploaded on 11/23/2010 for the course FINANCE 08FB40447 taught by Professor Raymond during the Spring '10 term at University of Manchester.

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PracticeQuestion_CH18-1 - Name: _ Date: _ 1. In the United...

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