Suppose That the Money Multiplier Is 3

question 49

Multiple Choice

Suppose that the money multiplier is 3. If the monetary base increases by $1 million, the quantity of money will

• A)increase by $300,000.
• B)decrease by $3 million.
• C)decrease by $300,000.
• D)increase by $3 million.

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Definitions:

Industries

Sectors or categories of business activity focused on the production or delivery of goods and services.

Employer-Provided

Services or benefits offered to employees directly by their employer, such as health insurance, retirement plans, or transportation allowances.

Less Cost

Refers to a reduction in expenses or costs incurred by an organization or individual.

Direct Pay

Wages or salaries that employees receive directly from their employer as compensation for their labor.