If the Federal Reserve Increases the Interest Rate on Bank

question 21

Multiple Choice

If the Federal Reserve increases the interest rate on bank deposits at the Fed,banks will want to hold

• A)fewer reserves,so the money multiplier will fall.
• B)fewer reserves,so the money multiplier will rise.
• C)more reserves,so the money multiplier will fall.
• D)more reserves,so the money multiplier will rise.

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Definitions:

Salesperson

An individual who sells products or services to customers, aiming to meet or exceed sales targets.

Shelf Life

The length of time that a product remains usable, fit for consumption, or salable.

Problem

A situation, question, or condition that presents a challenge or difficulty requiring a solution or answer.

Decision

The process or act of making a choice or judgement among several alternatives.