If D Equals the Maximum Amount of New Demand-Deposit Money $m = E / D$

question 203

Multiple Choice

If D equals the maximum amount of new demand-deposit money that can be created by the banking system on the basis of any given amount of excess reserves; E equals the amount of excess reserves; and m is the monetary
Multiplier, then

• A) \(m = E / D\)
• B) \(D = E \times m\)
• C) \(D = E - 1 / m\)
• D) \(D = m / E\)

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