The Money Multiplier Is

question 249

Multiple Choice

The money multiplier is

• A) the amount by which a change in the quantity of money is multiplied to determine the change in the monetary base.
• B) equal to bank reserves divided by the change in the monetary base.
• C) the amount by which a change in the monetary base is multiplied to determine the change in the quantity of money.
• D) equal to bank reserves divided by the change the quantity of money.

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Definitions:

Weighted-Average Cost Method

An inventory costing method that assigns the average cost of goods available for sale to both ending inventory and cost of goods sold, weighted by the quantity of goods.

LIFO

Last In, First Out is a method of valuing inventory where the items that were most recently produced or purchased are the first ones to be used in the calculation of cost of goods sold.

Periodic Inventory System

An inventory accounting system where updates are made on a periodic basis, such as monthly or yearly, rather than continuously.

Average-Cost Method

An inventory valuation method that calculates stock value based on the average cost of goods available for sale during the period.