If All Banks Are Subject to a Uniform 25% Reserve

question 75

Multiple Choice

If all banks are subject to a uniform 25% reserve requirement and demand deposits are the only form of money,a $1,000 open market sale by the Fed would cause the money supply to

• A)increase by $1,000.
• B)decrease by $1,000.
• C)decrease by $4,000.
• D)increase by $4,000.

---

Definitions:

Continuity

Continuity refers to the concept of maintaining a consistent structure, process, or condition over time, emphasizing stability and ongoing connection.

Discontinuity

A lack of continuity, sequence, or coherent connection in a process or phenomenon.

Participant Attrition

The loss of participants over the course of a study, which can affect the validity and reliability of the research findings.

Longitudinal

refers to research or observational studies that follow the same subjects over a period of time, noting changes and developments.