Question

Did I do number 17 right

) ) remain the same. but the direction of the change cannot be determined without information on the reserve ratio. Dir decrease Br The Bank of Canada cannot shift government funds from itself to the chartered banks reserve ratio is 20 percent and banks have no excess reserves. Katie deposits $300 in her bank What is the maximum that Katie's bank can now loan? A) $1,200 C) 5480 D) S60 18) Other things remaining the same, if the Bank of Canada increases the quantity of money, the supply of money curve shifts A) leftward and the price level rises. B) leftward and the infiation rate falls. C) leftward and the nominal interest rate rises. D) rightward and the nominal interest rate falls. TS Cd E) rightward and the price level falls. 19) All demand deposits are indluded in A) savings balances only B) M1 only 20) The precautionary motive for holding money arises from the A) fear that interest rates will fall. B) desire to avoid paying interest on credit purchases 9) uncertainty of the synchronization of payments and receipts fear that interest rates will rise. E) need to make predictable purchases of goods and services

300-300×20%=240

Answer 1

Ans. 17 b) $240

As desired reserve ratio is 20% that means the amount kept in reserve on deposit of $300 is $300 x 20/100= $60

and there is no excess reserve so, the remaining amount out of total deposit will be loaned out and that is,

loan amount = total deposit - reserve amount

= $300 - $60 = $240