The maximum amount of increase in the money supply that can be caused by an increase in excess reserves is equal to the
A) deposit multiplier ´ the required reserve ratio.
B) loan multiplier ´ the change in excess reserves.
C) deposit multiplier ÷ the change in excess reserves.
D) deposit multiplier ´ the change in excess reserves.
Ans: D) deposit multiplier ´ the change in excess reserves.
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A) An explicit B) An implicit C) A total D) A fixed E) A marginal
During the 1980s both the relative price and the purchases of BMWs increased dramatically. In the economic way of thinking,
A) the supply curve of BMWs shifted to the right. B) the demand curve for BMWs shifted to the right. C) the supply curve of BMWs shifted to the left. D) the demand curve for BMWs shifted to the left.