Why didn't the surge in the monetary base between 2008-2012 lead to a similar surge in the money supply?
A) The currency-deposit ratio rose significantly, resulting in a much smaller money multiplier.
B) The excess reserve-deposit ratio rose significantly, resulting in a much smaller money multiplier.
C) The Fed increased the required reserve ratio, resulting in a much smaller money multiplier.
D) Nonborrowed reserves declined, offsetting the increase in the monetary base.
Correct Answer:
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