The Money Multiplier Will Be

question 130

Multiple Choice

The money multiplier will be

• A) larger if banks hold on to excess reserves but smaller if private citizens hold on to cash.
• B) smaller if banks hold on to excess reserves but larger if private citizens hold on to cash.
• C) smaller if either banks hold on to excess reserves or private citizens hold on to cash.
• D) larger if either banks hold on to excess reserves or private citizens hold on to cash.
• E) constant whether or not banks and citizens try to alter their holdings of excess reserves and cash.