Which of the Following Changes Would Clearly Increase the Supply

question 19

Multiple Choice

Which of the following changes would clearly increase the supply of money in the banking system?

• A)​an increase in the percentage of money people want to hold as currency and a decrease in the fraction of deposits banks want to hold as excess reserves
• B)​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 excess reserves
• C)​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 excess reserves
• D)​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 excess reserves

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Definitions:

General Journal

A book or digital record used in double-entry bookkeeping to chronicle all financial transactions in chronological order, allowing for the tracking of all company transactions.

Accounting System Design

The process of defining the structure, components, and processes of an accounting system tailored to meet specific financial reporting and management needs.

Internal Controls

Systems and procedures implemented by a company to ensure the integrity of financial and accounting information.

Information Processing

The collection, manipulation, storage, retrieval, and classification of information.