If the reserve requirement changes from 10% to 15%, what happens to the money multiplier?
A) It goes up.
B) It goes down.
C) It stays the same.
D) It becomes 15.

Name: If the reserve requirement changes from 10% to 15%, what happens to the money multiplier? A) It goes up. B) It goes down. C) It stays the same. D) It becomes 15.
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Question

Quizplus · Accepted Answer

The money multiplier is the reciprocal of the reserve requirement. So, if the reserve requirement increases, the money multiplier decreases.

If the Reserve Requirement Changes from 10% to 15%, What