For a Given Level of Reserves, an Increase in the Reserve

question 67

Multiple Choice

For a given level of reserves, an increase in the reserve requirement ratio will

• A) decrease legal reserves and decrease the money supply.
• B) increase legal reserves and decrease excess reserves.
• C) increase legal reserves and increase excess reserves.
• D) increase excess reserves and increase the money supply.

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Definitions:

RUPA

The Revised Uniform Partnership Act, which governs the operation of partnerships and the relationship between partners in the United States.

Continuity

The state of remaining consistent, unchanged, or uninterrupted over time.

Entity

An organization, company, or individual that has a distinct legal existence and can enter into legal contracts or be subject to legal rights and obligations.

Aggregate

Aggregate refers to a total amount or sum formed by combining several separate elements or components.