In macroland, currency held by the public is 2,000 econs, bank reserves are 300 econs, and the desired reserve/deposit ratio is 15 percent. if commercial banks borrow 100 econs in reserves from the central bank through discount window lending, then the money supply in macroland will to econs, assuming that the public does not wish to change the amount of currency it holds.
a. increase; 3,133
b. increase; 4,100 c. increase; 4,667 d. increase; 2,667

Option (C) is correct.

Explanation:

Given that,

Currency held by the public = 2,000 econs

Bank reserves = 300 econs

Desired reserve/deposit ratio = 15 percent

If Commercial banks borrow 100 econs in reserves from the Central Bank.

= 0.15

= 0.15

Deposits =

              = 2000

Money supply = Currency held by the public + Deposits

                      = 2,000 + 2,000

                      = 4,000

Money multiplier =

                          =

                          = 6.67

Increase in money supply = Borrowing amount × Money multiplier

                                         = 100 x 6.67

                                         = 667

Hence, money supply increases from 4,000 econs to 4,667 econs.

send the charted data

lbc corporation makes and sells a product called product wz. each unit of product wz requires 4.1 hours of direct labor at the rate of $20.00 per direct labor-hour. management would like you to prepare a direct labor budget for june. the company plans to sell 28,000 units of product wz in june. the finished goods inventories o