An Increase in the Reserve Ratio Would Tend to

question 157

Multiple Choice

An increase in the reserve ratio would tend to

• A)increase excess reserves and raise the money multiplier.
• B)decrease excess reserves and decrease the money multiplier.
• C)increase excess reserves and decrease the money multiplier.
• D)decrease excess reserves and raise the money multiplier.

---

Definitions:

Balance Sheet

A financial statement that reports a company's assets, liabilities, and shareholders' equity at a specific point in time.

Accounts Payable

Short-term financial obligations or debts a company owes to its suppliers or creditors for goods and services received but not yet paid for.