Why didn't the surge in the monetary base between 2008-2012 lead to a similar surge in the money supply?
A) The currency-deposit ratio rose significantly, resulting in a much smaller money multiplier.
B) The excess reserve-deposit ratio rose significantly, resulting in a much smaller money multiplier.
C) The Fed increase the required reserve ratio, resulting in a much smaller money multiplier.
D) Nonborrowed reserves declined, offsetting the increase in the monetary base.
Question 2
The real business cycle model replicates the key business cycle regularities
A) both qualitatively and quantitatively.
B) qualitatively but not quantitatively.
C) quantitatively but not qualitatively.
D) neither qualitatively nor quantitatively.
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