An Increase in Reserves Leads to an Even Larger Increase

question 31

True/False

An increase in reserves leads to an even larger increase in deposits because banks have an incentive to lend their excess reserves.

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Definitions:

Reconstruction

The period following the Civil War (1865-1877) during which the United States attempted to address the issues arising from the readmission to the Union of the 11 states that had seceded.

Northern Investors

Businesspersons or companies from the northern United States who invested capital, especially in the development of the southern states and various industries.

Plessy V. Ferguson

A landmark 1896 U.S. Supreme Court decision that upheld the constitutionality of racial segregation under the "separate but equal" doctrine.

Segregated Facilities

Public or private establishments that were separated based on race or ethnicity, typified by signs designating usage by either 'whites' or 'colored' during periods of legal segregation.