A Desire by ________ Has No Effect on the Ability

Multiple Choice

A desire by ________ has no effect on the ability of the banking system to create bank deposits,for a given amount of reserves in the banking system.

A) banks to delay making loans in expectation of higher future interest rates
B) households to increase the fraction of their money held in the form of currency
C) households to hold more money in safety-deposit boxes
D) the government to increase its level of spending
E) firms to reduce their desired level of borrowing from banks