The Fed Is Reluctant to Change the Required Reserve Rate

question 74

Multiple Choice

 The Fed is reluctant to change the required reserve rate because: ?

• A) changes in the rate have a small impact on the actual quantity of money.?
• B) the money multiplier is not impacted by the required reserve rate.?
• C) the time lag between changing the required reserve rate and changes in the money supply can be too long.?
• D) small changes in the required reserve rate can have too big of an impact on the money multiplier and the level of deposits.

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