The size of the money multiplier depends mainly on:

Name: The size of the money multiplier depends mainly on:
Brand: Quizplus
Rating: 4.7 (53 reviews)

Question

Quizplus · Accepted Answer

The size of the money multiplier is primarily determined by the reserve ratio. The reserve ratio is the fraction of deposits that banks are required to hold in reserve and not lend out. A lower reserve ratio means banks can lend more, thus increasing the money multiplier effect, whereas a higher reserve ratio reduces the ability of banks to lend, thereby decreasing the money multiplier.

The Size of the Money Multiplier Depends Mainly On