Changes in reserve requirements directly and immediately affect
A) the monetary base.
B) banks' holdings of securities.
C) the Fed's holdings of foreign exchange.
D) the money multiplier.
D
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When housing prices began to decline after their peak in 2006, many subprime borrowers found that their mortgages were "underwater." This meant that
A) the value of the house fell below the amount of the mortgage. B) the basement flooded since they could not afford to fix the leaky plumbing. C) the roof leaked during a rainstorm. D) the amount that they owed on their mortgage was less than the value of their house.
When the price of coffee is $2.2 per cup, 11 million cups are demanded, and when the price of coffee goes up to $2.6 per cup, 10 billion cups are demanded. The coffee in this range has a(n)
A) elastic demand. B) inelastic demand. C) unit elastic demand. D) perfectly elastic demand.