please choose one answer for each question :

The proportion of currency banks hold in their vault relative to their deposits they hold is called the _____ ratio.

a.

Liquidity.

b.

Acid-test.

c.

Currency drain.

d.

Reserve.

Monetary policy is more powerful when the _____ is large...

a.

Money multiplier.

b.

Amount of excess reserves commercial banks hold.

c.

Desired reserve ratio of commercial banks.

d.

Amount of currency the non-bank public holds.

According to the textbook, which of the following is unaffected by changes in interest rates?

a.

Consumption.

b.

Net exports.

c.

Government expenditure.

d.

Investment.

If real money demand is given by L = 100 - 20i, where i is listed in percent (ie, i = 5 means the interest rate is 5 percent), and the Bank of Canada wishes to have an equilibrium interest rate of 4 percent, then the appropriate real money supply is...

a.

60.

b.

20.

c.

120.

d.

80.

If the government conducts an open-market purchase, this will...

a.

Cause interest rates to increase.

b.

Increase the monetary base.

c.

Decrease the money supply.

d.

Cause reserve ratios to decrease.