Suppose someone keeps $100 in cash under her pillow. One day, she takes it out and deposits

Question:

Suppose someone keeps $100 in cash under her pillow. One day, she takes it out and deposits it in a checking account.
a. Does this action directly affect the monetary base or the money supply? Explain why or why not.
b. Does the action eventually lead to a change in the monetary base or the money supply? Explain why or why not.
Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question
Question Posted: