If the Reserve-Deposit Ratio Is Less Than One, and the Monetary

question 98

Multiple Choice

If the reserve-deposit ratio is less than one, and the monetary base increases by $1 million, then the money supply will:

• A) increase by $1 million.
• B) decrease by $1 million.
• C) increase by more than $1 million.
• D) decrease by more than $1 million.

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Definitions:

Existence Values

The value that people place on knowing that a particular natural environment, species, or cultural heritage exists, even if they will never experience it directly.

Instrumental Value

The value attributed to something for its usefulness in achieving a desired end or purpose, rather than for its inherent qualities.

Greenhouse Effect

A natural process where certain gases in a planet's atmosphere trap heat, keeping the planet warmer than it would be otherwise.

Carbon Dioxide

A colorless, odorless gas produced by burning carbon and organic compounds and by respiration. It is naturally present in the earth's atmosphere.