In a system of fractional-reserve banking, even without any action by the central bank, the money supply

Fantastic news! We've Found the answer you've been seeking!

Question:

In a system of fractional-reserve banking, even without any action by the central bank, the money supply can increase if households choose to hold ______ currency or if banks choose to hold _____ excess reserves.

Select one:

a. more / more

b. more / less

c. less / more

d. less / less

e. none of the above

Related Book For answer-question

Principles of Economics

ISBN: 978-1285165875

7th edition

Authors: Gregory Mankiw

See More Books

Posted Date: Jan 29, 2024 07:19 AM

See More Questions

The company uses departmental overhead rates. Cutting and Tooling use machine hours. Assembly uses direct labor hours. In December of the year just completed, the company estimated thenew year's...
If you "load down" your car by placing passengers, cargo, etc into it, how does this affect the tires? Assume there are no leaks in the tires. Group of answer choices a. Tire pressure should increase...
What is the formula for the data below using INDEX + MATCH A Sales Units Month January 6 February 5 March B C D 7 April 8,629 3,943 8,702 5,991 8 May 9 June 10 July 11 August 12 September 13 October...
How does ESMA support national regulators in enforcing the application of IFRS?
The Hydrogenics case is the first in a series of four cases that illustrate a comprehensive analysis of an international corporation. In this case the balance sheet will be analyzed with the income...
2. The normal melting point of mercury is -38.87C. At this temperature, the density of liquid mercury is 13.65 g/cm and the density of solid mercury is 14.26 g/cm3. The heat of fusion is 2.333...
Identify the two ways that trial material may be organized. What are the advantages and disadvantages of each method?
In its May 31, 2017 annual report, Maloneck Ltd. (Maloneck) reported that it had inventory of $175,000 and accounts payable of $104,000 on May 31, 2016, and inventory of $196,000 and accounts payable...
Firm B is currently an all-equity firm with 10 million shares. Its earnings before interest and taxes (EBIT) is $10 million and will stay the same forever. The firm's cost of equity is 10%. What is...
1. Identify possible causes that could explain Intertechs declining profitability. What steps can the Stadlens take to reverse this alarming trend? 2. What can the Stadlens do to manage their...
Liquids are called fluids because A)Particles of a liquid have no force of attraction between them B) Particles of a liquid have spaces between them C) Liquids do not fill the whole container in...
what ways can authentic leadership be cultivated within individuals, and how does its emphasis on self-awareness and moral integrity contribute to organizational effectiveness and employee engagement...
imagine you were the VP of Human resource department an you need to find An issue of internal communication Since a lot of people were working remote, a solution and proposal benefits See Example...
Consider an industry consisting of two firms which produce a homogeneous commodity. The industry demand function is Q = 100 - P, where Q is the quantity demanded and P is its price. The total cost...
After viewing the CNBC Report on Starbucks' Billion Dollar Business, proceed to the Discussion Board to chat with your peers about what you've learned. At the time of this report, Starbucks sales...
a)Today's economic environment is challenged with higher than normal inflation, and the Bank of Canada has resorted to increasing interest rates to cool the economy. briefly describe the impact on...
The following information is available from Gum Ltd's statement of financial position as at 30 June 2022: Cash Bank Bills Accounts Receivable Allowance for doubtful debts Inventory Prepayments...
In the simple quantity theory of money, what will lead to an increase in aggregate demand? In monetarism, what will lead to an increase in aggregate demand?
Is unemployment typically short-term or long-term? Explain.
Multiple Choice Questions 1. The money supply includes all of the following EXCEPT a. Metal coins. b. Paper currency. c. Lines of credit accessible with credit cards. d. Bank balances accessible with...
A storm destroys half the fava bean crop. Is this event more likely to hurt fava bean farmers if the demand for fava beans is very elastic or very inelastic? Explain.
If share rights are recognized on issuance, what happens to the share rights account if the share rights are exercised? Allowed to lapse? Compare this to the treatment of the common share conversion...
When would a share-based compensation contract, payable after three years, result in an equity account being recognized in the first year? A liability? Both equity and a liability?
Assume that a cash-settled share-based payment scheme is established for an employee group. It will vest over five years, and be paid at the end of the fifth year. The total fair value of the plan is...

In a system of fractional-reserve banking, even without any action by the central bank, the money supply

Question:

Expert Answer:

The detailed answer for the above question is provided below The correct a... View the full answer

Principles of Economics

Students also viewed these economics questions