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2.4 Financial markets and monetary policy (A-level only)

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Question 49

A retail customer withdraws £500 in cash from their current (deposit) account at a commercial bank ATM. All other things being equal, which combination of events shows the immediate effect of this transaction on the bank's balance sheet and the broad money supply?

A

Bank's liabilities fall; Bank's assets fall; Broad money supply is unchanged

B

Bank's liabilities fall; Bank's assets fall; Broad money supply falls

C

Bank's liabilities are unchanged; Bank's assets fall; Broad money supply falls

D

Bank's liabilities fall; Bank's assets are unchanged; Broad money supply is unchanged

Markscheme

2.4 Financial markets and monetary policy (A-level only) Questions

  1. A Level
  2. /Economics
  3. /2.4 Financial markets and monetary policy (A-level only)

176 exam-style questions on AQA A Level Economics 2.4 Financial markets and monetary policy (A-level only), covering 2.4.1 The structure of financial markets and financial assets, 2.4.2 Commercial banks and investment banks, 2.4.3 Central banks and monetary policy, and 2.4.4 The regulation of the financial system. Each one has a worked solution and a mark scheme showing where the marks go.

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