9. The payments you make on your car loan are given in terms of dollars. As pric

Question

9. The payments you make on your car loan are given in terms of dollars. As prices rise, you notice that you give up fewer goods to make your payments. Based on this information, We can conclude that: The dollar amount value. The dollar amount you pay is a real value. The number of goods you give up is a nominal momina valic: The mumber ofpods ou g u ral a. b. value Both the dollar amount you pay and the goods you give up are nominal values. The dollar price of cars is a real variable; the relative price of cars is a nominal variable. c. d. 10. If the reserve ratio is 4 percent, then $81,250 of deposits can be generated by: a. b. c. d. $4 of new deposits. $3,250 of new deposits. $20,312.50 of new deposits. $78,125 of new deposits.

Explanation / Answer

1- from this we can easily conclude that the dollar amount that we pay is a nominal value, but as we cant sacrifice more on the goods we consume because these are real goods we are talking about, so answer is A

2- now here the multiplier is given by 1/0.04 = 25

so the deposits required are

81250/25 = 3250

so answer is B

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