The Effect on Multiple Deposit Expansion

question 84

Multiple Choice

The effect on multiple deposit expansion

• A)is greater if banks use excess reserves to make loans than if they use them to buy securities.
• B)is greater if banks use excess reserves to buy securities than if they use them to make loans.
• C)is the same whether banks use excess reserves to buy securities or to make loans.
• D)is dependent upon the types of loans banks make and the types of securities banks buy.

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