Pts question 27 supplied demanded shortage supplied

1 pts Question 27
If the interest rate is below the equilibrium interest rate, then the quantity __________ of
money exceeds the quantity __________ of money, and there is a __________ of
money.
supplied; demanded; shortage
supplied; demanded; surplus
demanded; supplied; shortage
demanded; supplied; surplus
1 pts
Question 28
If M1 is $1,200 billion, currency held outside banks is $400 billion, and traveler's checks
is $10 billion, then small­denomination time deposits equal
There is not information to answer the question.

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1 pts
Question 29
Fiscal policy may not work as policymakers intend it to work because of
1 pts
Question 30
The economy is in a recessionary gap and there is evidence that the economy is in a
liquidity trap. In this situation, a Keynesian is likely to advocate the use of __________
policy.
1 pts
Question 31
The economy is in the horizontal portion of the AS curve, investment spending is interest
insensitive and there is no liquidity trap. According to the Keynesian transmission
mechanism, if the money supply increases the interest rate will __________, investment

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fall; fall; left; fall
rise; drop; left; fall
fall; remain unchanged; not shift; not change
rise; remain unchanged; not shift; not change
none of the above
spending will __________, the AD curve will __________, and Real GDP will
__________.
1 pts
Question 32
When a bank makes a loan to one of its customers, to the bank the loan is classified as
an asset.
a liability.
neither an asset nor a liability.
an asset in some cases and a liability in other cases, depending on the type of loan.
1 pts
Question 33
If reserves increase by $7 million and the required reserve ratio is 12%, what is the
resulting change in checkable deposits (or the money supply), assuming that there are no
cash leakages and that banks hold zero excess reserves?

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$58.33 million
1 pts
Question 34
A bank has $7 million in checkable deposits and $1.2 million in total reserves. If the
required reserve ratio is 10 percent, then the bank has
1 pts