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Question
As a result of an increase in the money supply, some banks may end up with excess reserves.
What is the likely result?
A) Banks will make more loans, thereby contributing to an increase in aggregate demand.
B) Banks will make more loans, thereby contributing to a decrease in aggregate demand.
C) Banks will raise interest rates.
D) Banks will spend the excess reserves by paying their employees more.
Answer
This answer is hidden. It contains 1 characters.
Related questions
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