Which Statement Best Describes the Outcomes of a Decrease in Reserve

question 171

Multiple Choice

Which statement best describes the outcomes of a decrease in reserve requirements?

• A) The reserve ratio decreases, the money multiplier decreases, and the money supply decreases.
• B) The reserve ratio increases, the money multiplier increases, and the money supply increases.
• C) The reserve ratio decreases, the money multiplier increases, and the money supply increases.
• D) The reserve ratio increases, the money multiplier decreases, and the money supply decreases.

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Definitions:

Parasympathetic

refers to the part of the autonomic nervous system that conserves energy as it slows the heart rate, increases intestinal and gland activity, and relaxes sphincter muscles in the gastrointestinal tract.

Skeletal

Pertains to the skeleton or bony framework of the body, which supports and gives shape to the body.

Autonomic Nervous System

A division of the peripheral nervous system that regulates involuntary functions such as heart rate, digestion, and respiratory rate.

Somatic Nervous System

Part of the peripheral nervous system that handles voluntary control of body movements through the control of skeletal muscles.