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Homework answers / question archive / Select ALL the CORRECT answers regarding the money multiplier (bank multiplier): A

Select ALL the CORRECT answers regarding the money multiplier (bank multiplier): A

Economics

Select ALL the CORRECT answers regarding the money multiplier (bank multiplier):

A. If the proportion of the demand for money that the population wants to keep in cash is 1, the bank multiplier is 1.

B. If the bank multiplier is greater than 1, the monetary base is greater than the money supply.

C. It allows calculating the change in the money supply before a change in the monetary base.

D. Represents the waves of induced spending in an economy derived from a change in autonomous spending.

E. If the central bank imposes a regulation in which the demand deposit reserves that commercial banks have to hold decrease, the bank multiplier increases.

F. If the bank multiplier is equal to 1, the monetary base is less than the money supply.

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