When People Make Deposits of Currency into a Bank,the Quantity

question 75

Multiple Choice

When people make deposits of currency into a bank,the quantity of M1

• A)immediately decreases by the amount of the deposit.
• B)immediately increases by the amount of the deposit.
• C)does not immediately change.
• D)immediately changes but whether it increases or decreases depends on whether the bank had excess reserves or did not have excess reserves.
• E)changes only if the deposit is an open market operation.

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