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      Question

      ____ in reserve requirements ____ the money supply since

      it causes the money multiplier to ____.
      A Decrease; increases; rise. Correct Answer Incorrect Answer
      B Decrease; decreases; fall Correct Answer Incorrect Answer
      C Rise; increase; rise. Correct Answer Incorrect Answer
      D Rise; decrease; rise Correct Answer Incorrect Answer

      Solution

      Decrease in reserve requirements increase the money supply since it causes the money multiplier to rise.

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