Answer the given question with a proper explanation and step-by-step solution. 19.Do banks earn interest on the reserves that they hold?O O O O OA. Banks earn 0% interest on the reserves they hold.B. Yes, and the rate is the same rate that they earn on the loans the bank makes.C. Yes, and the rate is the same rate that they pay depositors on their checkable deposits.D. Banks earn interest on reserves held at the Fed, but nothing on reserves kept in their vaults.E. Banks earn a rate of interest equal to the reserve ratio.Submit AnswerContinue without saving 15.Suppose that the real exchange rate between the United States and Kenya is defined in terms of baskets of goods. Which ofthe following will increase the real exchange rate (that is increase the number of baskets of Kenyan goods a basket of U.S.goods buys)?I. an increase in the number of Kenyan shillings that can be purchased with a dollarII. an increase in the price of U.S. baskets of goodsIII. a decrease in the price in Kenyan shillings of Kenyan goodsA. I and III only.B. II and III only.C. I and II only.D. I only.E. I, II and III.Submit AnswerContinue without savingIn the U.S. a digital camera costs $150. The same camera in London sells for 60 pounds. If the exchange rate is .50 pounds per dollar.10.5. Based on the predicted nominal exchange rate you calculated if PPP is achieved, what should happen to the nominalexchange rate (pounds per dollar) over time?A. It should fall.B. It could rise or fall depending on the demand for digital cameras.C. It would remain the same.D. It should rise.Submit AnswerContinue without saving

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19. Do banks earn interest on the reserves that they hold? A. Banks earn 0% interest on the reserves they hold. B. Yes, and the rate is the same rate that they earn on the loans the bank makes. C. Yes, and the rate is the same rate that they pay depositors on their checkable deposits. D. Banks earn interest on reserves held at the Fed, but nothing on reserves kept in their vaults. E. Banks earn a rate of interest equal to the reserve ratio.

19. Do banks earn interest on the reserves that they hold? A. Banks earn 0% interest on the reserves they hold. B. Yes, and the rate is the same rate that they earn on the loans the bank makes. C. Yes, and the rate is the same rate that they pay depositors on their checkable deposits. D. Banks earn interest on reserves held at the Fed, but nothing on reserves kept in their vaults. E. Banks earn a rate of interest equal to the reserve ratio.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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