The Expansion of Deposits Resulting from an Injection of Cash

question 89

Multiple Choice

The expansion of deposits resulting from an injection of cash to the banking system can be calculated as follows:

• A)the change in deposits is equal to the change in loans divided by the sum of the target reserve ratio.
• B)the change in deposits is equal to the change in reserves divided by the cash- deposit ratio.
• C)the change in deposits is equal to the change in reserves divided by the sum of excess reserves and cash drain.
• D)the change in deposits is equal to the change in reserves divided by the sum of the target reserve ratio and the cash- deposit ratio.
• E)the change in deposits is equal to the change in reserves divided by the target reserve ratio.

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Definitions:

Operant Behavior

a type of learning where behavior is controlled by consequences, including rewards for reinforcement or punishment to decrease a behavior.

Immediate Reinforcers

Rewards that are given instantly following a desired behavior, thus strengthening the behavior's occurrence.

Magazine Subscriptions

The process of paying in advance to receive regular issues of a magazine over a specified period.

Reinforced

In behavioral psychology, refers to the strengthening of a behavior pattern by reinforcement, such as rewards or punishments, which increases the likelihood of the behavior being repeated.