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1. Suppose Fred deposits $8,000 in cash into his checking account at the Bank of Bonzo. The Bank of Bonzo has no excess reserves and is subject to a 5 percent required reserve ratio.
a. Show this transaction in a T-account for the Bank of Bonzo.
b. Assume the Bank of Bonzo makes the maximum loan possible from Fred's deposit to Clarice and show this transaction in a new T-account.c. Clarice decides to use the money she borrowed to take a trip to Tahiti. She writes a check for the entire loan amount to the Tropical Paradise Travel Agency, which deposits the check in its bank, the Iceberg Bank of Barrow, Alaska. When the check clears, the Bonzo Bank transfers the funds to the Iceberg Bank. Show these transactions in a new T-account for the Bonzo Bank and in a T-account for the Iceberg Bank.
d. What is the maximum amount of deposits that can be created from Fred's initial deposit?
e. What is the maximum amount of loans that can be created from Fred's initial deposit?
2. What are the three tools the Fed can use to change the money supply? Briefly describe how the Fed can use each of these tools to either increase or decrease the money supply.
If you were the owner of an automobile company and decided to market internationally, would you face imperfect, monopolistic, oligopolistic, or perfect competition? Please justify your answer.
Your answer should demonstrate that the prices that are used to calculate real GDP do affect the calculated growth rate, but typically not by very much.
Sketch the demand curve, MR curves well as the MC curve as per information above.
Suppose you have a choice between having an income of 300 with certainty and a lottery that makes your income equal to 400 with probability 0.5 and equal to 200 with probability 0.5.
What are the implications for aid policies?
What is the primary difference between the review questionnaire and the independent review questionnaire? What are the similarities between the two?
Estimate the number of pore volumes required to reduce 99% of the porewater concentration of the following contaminants from an aquifer with 2% organic carbon content and a porosity of 0.4: 1,2-dichloroethane, 1,4-dichlorobenzene, biphenyls, and A..
When Groucho's deli lowers the price of their sandwiches by 9% the quantity demanded of Todaro pizza falls by 12%. What is the cross price elasticity of demand for Todaro pizza with respect to the price of Groucho's sandwiches.
Suppose that, in an attempt to raise more revenue, Nobody State University increases its tuition. Will this necessarily result in more revenue? Under what conditions will revenue (a) rise, (b) fall, or (c) remain the same?
Given that revenues from these congestion charges are invested in the city's transport system, how will this affect the charge level holding all other variables constant?
Robinson Plastics makes clear plastic products with injection molding techniques. Their latest invention is a plastic cup with a sharp blade mounted inside to cut prescription pills into small pieces.
Suppose a professor assigns a group project to a class. Each student in a group will receive the same grade, based on the project submitted by the group. Will this lead to a moral hazard problem? Explain.
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