During a Bank Run,depositors Decide to Hold More Currency Relative

question 18

Multiple Choice

During a bank run,depositors decide to hold more currency relative to deposits and banks decide to hold more excess reserves relative to deposits.

• A)Both the decision to hold relatively more currency and the decision to hold relatively more excess reserves would make the money supply increase.
• B)Both the decision to hold relatively more currency and the decision to hold relatively more excess reserves would make the money supply decrease.
• C)The decision to hold relatively more currency would make the money supply increase.The decision to hold relatively more excess reserves would make the money supply decrease.
• D)The decision to hold relatively more currency would make the money supply increase.The decision to hold relatively more excess reserves would make the money supply decrease

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Definitions:

Coercive Power

The ability to force someone to do something against their will, using threats, punishment, or control.

Reward Power

The ability of an individual or entity to influence others' behavior by controlling the allocation of rewards such as bonuses, promotions, or praise.

Expert Power

The influence and authority a person has as a result of their expertise, skills, or knowledge.

Avenues Of Appeal

Legal or procedural paths available for challenging decisions or seeking redress within judicial or administrative systems.