Everything Else Held Constant,an Increase in the Required Reserve Ratio

question 121

Multiple Choice

Everything else held constant,an increase in the required reserve ratio will mean ________ in the M2 money multiplier and ________ in the M2 money supply.

• A)an increase;an increase
• B)an increase;a decrease
• C)a decrease;an increase
• D)a decrease;a decrease

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Definitions:

Imagination Inflation

A situation where visualizing an event that never took place can boost the belief that it really happened.

Overlearning

The process of continuing to practice or study beyond just achieving initial mastery, enhancing performance and recall.

Retention

The ability to keep or hold information in memory over a period of time.

Distributed Practice

A learning strategy that involves spreading study sessions out over time rather than cramming them into a short period.