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Flashcards in More Si Session Deck (9)
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1
Q

What is calculated into GDP?

A

Consumption + investment + government expenditures + net exports

2
Q

If I invest $2,000 into my bank account and it accrues an anual interest rate of 8%, how long will it take me to have 8,00 in my account?

A

18 years

3
Q

Is available credit on a credit card considered money ?

A

NO

4
Q

Checking account balance accessible by an ATM card

A

M1 and M2

5
Q

Savings deposits are

A

M2

6
Q

What is the opportunity cost of holding large quantities of cash?

A

The internet you would have earned if you had invested it

7
Q

3 main motives behind why people hold money?

A
  1. Transaction motive (hold for spending)
  2. Precautionary motive (for unexpected expenses)
  3. Speculative motive (for if interest rate goes up)
8
Q

Are bond prices with fixed coupon rates (periodic payments) and interest rates inversely related ?

A

Yes when bond prices go up interest rate goes down

9
Q

To calculate the reserve requirement

A

Multiply required reserve ratio by the deposits