1) Recognizing the distinction between borrowed reserves and the nonborrowed monetary base, the money supply model is specified as
A) M = m × (MBn BR).
B) M = m × (MBn + BR).
C) M = m + (MBn BR).
D) M = m (MBn + BR).
2) During the bank panics of the Great Depression the currency ratio
A) increased sharply.
B) decreased sharply.
C) increased slightly.
D) decreased slightly.
3) During the bank panics of the Great Depression the excess reserve ratio
A) increased sharply.
B) decreased sharply.
C) increased slightly.
D) decreased slightly.
4) In the early 1930s, the currency ratio rose, as did the level of excess reserves. Money supply
analysis predicts that, everything else held constant, the money supply should have
A) risen.
B) fallen.
C) remain unchanged.
D) either risen, fallen, or remain unchanged.