Which of the following is false?
A) The Fed sets the required reserve ratio that determines the maximum amount of money that banks can lend.
B) Depository institutions must hold reserve assets equal to a fraction of deposit liabilities; that fraction is called the required reserve ratio.
C) The Fed controls the amount of cash assets available for reserves.
D) The Fed must consult with depository institutions before setting the required reserve ratio.
Correct Answer:
Verified
Q106: Ceteris paribus, increases in reserves will lead
Q107: Graphically, the demand curve for money is
A)upward
Q108: A rightward shift in the demand curve
Q109: A leftward shift in the demand curve
Q110: A rightward shift of the supply curve
Q111: A leftward shift of the supply curve
Q113: Ceteris paribus, as interest rates rise, the
Q114: Ceteris paribus, as interest rates decline, the
Q115: The demand for money is directly related
Q116: An increase in income will generally raise
A)the
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