Question:

Have some questions re: macroeconomics.. Please help?

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Which of the following would increase the deposit expansion multiplier?

a. Decreases in the reserve requirement

b. Increases in the reserve requirement

c. Decreases in excess reserves

d. Increased investor deposits in commercial banks

e. Increases in excess reserves

The maximum potential for which the entire banking system can create money is equal to

a. a fraction of its required reserves.

b. a fraction of its excess reserves.

c. a multiple of its total reserves.

d. its excess reserves.

e. a multiple of its excess reserves.

Which of the following would not constitute a currency drain?

a. A withdrawal of coins from the banking system

b. People carrying more money than usual in order to buy Christmas presents

c. A purchase of government securities

d. A banking panic that leads to large withdrawals from banks e. A withdrawal of currency from the banking system

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2 ANSWERS


  1. 1 - a

    2 - e

    3 - c


  2. I took macro in the spring at college and got an A ----Now my answers might be wrong still, but here's what i think.  

    1.---no idea.  didn't learn about that

    2.  e

    3.  b

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