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A Commentator Says That an Increase in Lending Will Lead

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Essay

A commentator says that an increase in lending will lead to an infinitely large increase in the money supply, since that money will be deposited and re-lent indefinitely. Could this possibly be true? Is it realistic?


Definitions:

Null Hypothesis

A hypothesis that suggests there is no statistical significance between the two variables being studied.

Rejecting

In statistical hypothesis testing, it refers to the act of dismissing the null hypothesis based on the level of significance and the test statistic.

Type I Error

The error of incorrectly dismissing a true null hypothesis, often referred to as a "false positive" in the context of hypothesis testing.

Innocent Person

An innocent person is someone who has not committed a crime or any offence they are accused of.

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