If the Monetary Authorities Want to Lower the Size of the Money

question 59

Multiple Choice

If the monetary authorities want to lower the size of the money multiplier, they should:

• A)ask chartered banks to lower their desired reserve ratio.
• B)ask chartered banks to raise their desired reserve ratio.
• C)take actions to increase bank reserves.
• D)do none of the above.

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Definitions:

Demand

The total quantity of a product or service that consumers are willing and able to purchase at various price levels at a given point in time.

Lipase

An enzyme that catalyzes the breakdown of fats into fatty acids and glycerol.

Gastrointestinal Tract

The pathway starting from the mouth to the anus, responsible for digestion and absorption of nutrients.

Lugol's Iodine

A solution used as a disinfectant and antiseptic, also for staining cells in cytological examinations.