Assuming a Simple Money Multiplier, If the Fed Increases Bank

question 103

Multiple Choice

Assuming a simple money multiplier, if the Fed increases bank reserves by $100 and the required reserve ratio is 2 percent, then the maximum increase in deposits within the banking system as a whole is

• A)$5,000.
• B)$500.
• C)$98.
• D)$2.

---

Definitions:

Popliteal Artery

The artery located behind the knee, which supplies blood to the knee joint and muscles in the thigh and calf.

Posterior Tibial Artery

A major artery of the lower leg, supplying blood to the posterior compartment of the leg and plantar surface of the foot.

Gonadal Artery

An artery that supplies blood to the gonads; the testicular artery in males and the ovarian artery in females, crucial for reproductive organ function.

Posterior Tibial Artery

An artery located behind the tibia bone in the lower leg, it supplies blood to the posterior compartment of the leg and plantar surface of the foot.