Deposit money banks and the creation of money - Jamb Economics Past Questions and Answers

Question 1:

• JAMB 2019

A demand which gives rise to the reverse of the law of demand is__________

A. Derived demand
B. Joint demand
C. Abnormal demand
D. Composite demand

Question 2:

• JAMB 2018

The term M \(^3\) comprises M \(^1\) together with deposits on deposit account held by_______

A. Banks only
B. Discount houses only
C. Banks and discount houses
D. Banks, discount houses and stock, exchanges

Question 3:

• JAMB 1983

The supply of loanable funds is significantly influenced by?

A. Commercial banks
B. Mortage banks
C. Financial intermediaries
D. The Central Bank
E. Insurance companies

Question 4:

• JAMB 1986

Given that the cash reserve ratio is 10 percent, what is the maximum amount of that the banking system can create from an initial cash deposit of N1,000.00?

A. N100.00
B. N1,000.00
C. N9,000.00
D. N10,000.00

Question 5:

• JAMB 1990

Find the total credit that the banking system can create if primary deposit is just N100.00 while the cash ratio is 20%

A. 700.00
B. 600.00
C. 500.00
D. 400.00