Currency Outside of Banks Increases from $100 Million to $200

question 488

Multiple Choice

Currency outside of banks increases from $100 million to $200 million. This change is considered

• A) a currency drain.
• B) a decrease in the monetary base.
• C) expansionary monetary policy.
• D) contractionary monetary policy.

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Definitions:

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the equilibrium price.

Simultaneously Increases

Occurring when two or more variables or conditions rise at the same time.

Supply Decreases

A situation where the quantity of a good or service that producers are willing to sell at a given price falls, often due to increased production costs or external factors.

Equilibrium Price

The market price at which the quantity of goods supplied is equal to the quantity of goods demanded.