Which of the Following Combinations Would Have an Indeterminate Effect

question 132

Multiple Choice

Which of the following combinations would have an indeterminate effect on the size of the money supply?

• A)a decrease in the percentage of money people want to hold as currency, and an increase in the fraction of deposits banks want to hold as reserves
• B)a decrease in the percentage of money people want to hold as currency, and no change in the fraction of deposits banks want to hold as reserves
• C)an increase in the percentage of money people want to hold as currency, and an increase in the fraction of deposits banks want to hold as reserves
• D)a decrease in the percentage of money people want to hold as currency, and a decrease in the fraction of deposits banks want to hold as reserves