SelfStudyQuiz Site Date/Time"/>

Chapter_23 - YourResultsfor"SelfStudyQuiz SiteTitle...

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Your Results for: "Self-Study Quiz" Print this page Site Title: Principles of Economics, Eighth Edition Book Title: Principles of Economics, 8/e Book Author: Case/Fair Location on  Site: Chapter 23 > Self-Study Quiz Date/Time  Submitted: February 8, 2012 at 8:01 AM  (UTC/GMT) Summary of Results 25% Correct  of 40 Scored items: 10 Correct:  25% 30 Incorrect:  75% 4 questions not scored. 40 scored questions. More information about scoring 1. Currency debasement  refers to: Your Answer:   Correct. Expanding the supply of currency so rapidly that it loses much of its value has  been a problem throughout history and is known as currency debasement. Debasement of  the currency has been a special problem of governments that lack the strength to take the  politically unpopular step of raising taxes. 2. Financial intermediaries  are: Your Answer: Officials in securities markets that government in the sale of governm Correct Answer: Banks and other institutions that a have money to lend and those wh   Incorrect. Financial intermediaries include banks and other institutions that act as a link  between those who have money to lend and those who want to borrow money. 3. Among the assets of a commercial 
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bank are: Your Answer:   Correct. Loans are usually the largest asset. The business of the bank is to profit from the  difference between interest received on loans and interest paid on deposits. 4. An open market sale of securities by  the Fed results in: Your Answer: A decrease in bank reserves, a de lower multiplier. Correct Answer: A decrease in bank reserves and    Incorrect. The money multiplier does not change with the sale of securities. 5. Assuming that banks are always  fully loaned and people hold no  cash, and given a required reserve  ratio of 20%, an infusion of $100  billion in reserves will result in a  maximum of: Your Answer: $120 billion in deposits. Correct Answer: $500 billion in deposits.   Incorrect. Change in deposits = 1/reserve ratio * change in reserves. 6. Assuming there are no leakages out  of the banking system, a money  multiplier equal to 10 means that:
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Your Answer: Each additional dollar of deposits  Correct Answer: Each additional dollar of reserves   Incorrect. It is the opposite. The money multiplier shows the relationship between the final  change in deposits and the change in reserves that caused it. 7. During the era of the goldsmiths a 
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This note was uploaded on 02/09/2012 for the course ECONOMY 101 taught by Professor Zaier during the Spring '11 term at Qatar University.

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Chapter_23 - YourResultsfor"SelfStudyQuiz SiteTitle...

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