If the Fed Increases the Required Reserve Ratio, How Will

question 191

Multiple Choice

If the Fed increases the required reserve ratio, how will this affect excess reserves and the money supply?

• A)Both will increase.
• B)Excess reserves increase and the money supply decreases.
• C)Both will decrease.
• D)Excess reserves decrease and the money supply increases.

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Definitions:

Affordable Health Care Act

A comprehensive health care reform law enacted in 2010 aimed at expanding access to insurance, increasing consumer protections, and emphasizing prevention and wellness.

Lower Premiums

Reduced costs for insurance coverage, often a result of decreased risk, loyalty discounts, or efficient company operations.

Profit-Sharing Plans

Compensation schemes where employees receive a portion of the company's profits, in addition to their regular salaries.

Salary Contributions

Payments made by employees or employers towards retirement plans, benefits, or other financial obligations based on salary percentages.