Suppose the M1 multiplier is currently 1.95 and the M2 multiplier is currently 8.03. If people decide to decrease the ratio of nontransaction accounts they hold relative to the amount of their transactions accounts, the M1 multiplier will ____ and the M2 multiplier will ____.

A. not change; decrease
B. increase; also increase
C. decrease; also decrease
D. increase; not change


Answer: A

Business

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