Which of the following is not true of the demand deposit multiplier?

a. Its formula is 1/RRR.
b. It represents the change in demand deposits generated by a change in reserves.
c. It represents the change in demand deposits generated by a change in taxes.
d. It is a way to determine the effect on money supply from a given Federal Reserve action.
e. It ignores changes in the behavior of the public and the banks.


C

Economics

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