As a result of the Fed's actions during the 2008 financial crisis and banks' lending policies, the money multiplier ________ as a direct result of the ________

A) fell from about 9 to about 4; low risk experienced by banks because of the FDIC increasing their default coverage amounts
B) decreased drastically; consistent decrease in banks' desired reserve ratios as they took on less risk
C) rose from about 4 to about 9; surge in banks' desired reserve ratios as they took on less risk
D) rose drastically; consistent decrease in banks' desired reserve ratios as they took on less risk
E) fell from about 9 to about 4; surge in banks' desired reserve ratios as they took on less risk


E

Economics

You might also like to view...

Which of the following is NOT correct about the effects of a tariff on an imported product?

A) Tariffs benefit domestic producers by raising price and domestic output. B) Tariffs increase government revenue. C) Tariffs mean higher prices and less consumption for consumers of the product. D) Tariffs increase the efficiency of how resources are allocated.

Economics

Which organization officially tracks all business cycles in the U.S. economy?

a. Department of Commerce b. National Bureau of Economic Research c. Bureau of Economic Analysis d. Census Bureau

Economics

Supply-side economists try to increase the AS curve with all of the following policies except

A. Deregulation. B. Infrastructure development. C. Decreasing the supply of money. D. Tax incentives for saving, investment, and work.

Economics

Government regulation of a natural monopoly causes its average cost curve to shift downward.

Answer the following statement true (T) or false (F)

Economics