1. If the required reserve is 0.2, the level of deposits is $1,000, the level of currency held by the public is $100, the level of excess reserves is $100, the level of MMF is $1,000 and the level of time deposits is $2,000, then M2 is:
A) 20.5 B) 8.5 C) 3.5 D) 11
2. Ceteris paribus, when __ increases, the ratio M2 increases.
A) RR B) C/D C) ER/D D) MMF/D
3. Ceteris paribus, an increase in the ratio T/D will cause M1 to:
A) stay the same
B) increase by larger proportion
C) decrease
D) increase by a smaller proportion