Other Things the Same, If Banks Decide to Hold a Smaller

question 136

True/False

Other things the same, if banks decide to hold a smaller part of their deposits as excess reserves, the money supply will fall.

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Definitions:

Primacy Effect

The tendency for individuals to remember items at the beginning of a list better than items in the middle or at the end.

Matching Effect

A phenomenon where advertisements are more effective when their content is aligned with the mood or the mindset of the audience.

Mere-Exposure Effect

A psychological phenomenon by which people tend to develop a preference for things merely because they are familiar with them.

Emotional Stability

Refers to the ability of an individual to remain stable and balanced in their emotions rather than being easily upset or emotional.