Other Things the Same,if Reserve Requirements Are Increased,the Reserve Ratio

question 35

Multiple Choice

Other things the same,if reserve requirements are increased,the reserve ratio

• A)increases,the money multiplier increases,and the money supply increases.
• B)increases,the money multiplier decreases,and the money supply decreases.
• C)decreases,the money multiplier increases,and the money supply increases.
• D)decreases,the money multiplier decreases,and the money supply increases.

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Definitions:

Operating Assets

Assets that are used for the day-to-day functioning of a business, excluding investment and non-operational assets.

Return On Investment

A performance measure used to evaluate the efficiency or profitability of an investment, calculated by dividing the profit from an investment by the cost of the investment.

Responsibility Accounting System

A system of accounting that involves assigning revenues and costs to the individuals or departments that are directly responsible for them.

Expenses

The money spent or costs incurred in an entity's efforts to generate revenue, representing the cost of doing business.