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Assume that banks become more conservative in their lending policies and start holding some excess ...

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Assume that banks become more conservative in their lending policies and start holding some excess ...

Question 1.

If the money multiplier is 8, the required reserve ratio is

▸ 8%.

▸ 12.5%.

▸ 16%.

▸ 20%.

Question 2.

Assume that banks become more conservative in their lending policies and start holding some excess reserves. Compared to a situation in which banks are not holding excess reserves, the size of the money supply will be

▸ zero.

▸ larger.

▸ the same.

▸ smaller.

Textbook

Principles of Economics

Edition: 12^th

Authors: Case, Fair, Oster

Read 75 times

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binva

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More solutions for this book are available here

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barry1999 Author

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This site is awesome!

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binva

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Good luck on the rest

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