Asked by Savannah Calkins on May 16, 2024
Verified
The money multiplier is higher when bankers are more cautious and hold excess reserves.
Money Multiplier
The ratio of the amount of deposits created by banks to the amount of the central bank's monetary base that has been injected into the economy.
- Learn about the core concepts of fractional-reserve banking and its effects on the availability of money.
Verified Answer
SS
siriprut saetieoMay 21, 2024
Final Answer :
False
Explanation :
The money multiplier is lower when bankers are more cautious and hold excess reserves, as they are lending out less of their deposits.
Learning Objectives
- Learn about the core concepts of fractional-reserve banking and its effects on the availability of money.