In Macroland,there Is $1,000,000 in Currency That Can Either Be

question 91

Multiple Choice

In Macroland,there is $1,000,000 in currency that can either be held by the public or used by banks as reserves.If the banks' desired reserve-deposit ratio increases from 10% to 15% and the public continues to hold the same amount of currency,the money supply in Macroland will

• A) increase.
• B) decrease.
• C) remain the same.
• D) either increase or decrease.
• E) increase initially,but then return to the original level.

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Definitions:

Simulation Analyses

A statistical method that attempts to predict the outcome of a decision or investment by representing possible scenarios and their impacts.

Incremental Cash Flows

The additional cash flows from operations that a business generates from taking on a new project.

Marketing Study

An analysis or research conducted to gain insights into and understand potential market trends, consumer behaviors, or the effectiveness of marketing strategies.

Shipping Costs

Expenses associated with the transportation of goods from one location to another.