A Decrease in the Excess Reserves Banks Want to Hold

question 133

Multiple Choice

A decrease in the excess reserves banks want to hold, together with people taking currency out of their demand deposit accounts, would:

• A)​increase the money supply.
• B)​decrease the money supply.
• C)​leave the money supply unchanged.
• D)​have an indeterminate effect on the money supply.

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Definitions:

Coefficient Alpha

A statistic used to assess the reliability or consistency of a set of scale or test items.

Life Satisfaction

An evaluation of how one’s life is generally and how it compares to some standard.

Positively Correlated

Describes a relationship between two variables where they move in the same direction, meaning as one variable increases, the other also increases, or as one decreases, so does the other.

Correlation Coefficient

A statistical measure that indicates the extent to which two or more variables fluctuate together.