21:

Suppose Canadian banks increase their desired reserve ratios from 10% to 20% of bank deposits. Holding everything else constant, this will

Select one:

a.reduce the size of the money multiplier.

b.cause the banking system to contract the level of bank deposits in the banking system.

c.change the value of the money multiplier from 10 to 5.

d.Answers (a), (b), and (c) are all correct.