Post Utme Mountain Top University 2025 Economics Question 19

Practice objective / multiple choice question 19 from the 2025 Post Utme Mountain Top University Economics examination.

Post Utme Mountain Top University 2025 Economics Objective / Multiple Choice
Question 19 POST_UTME_MOUNTAIN_TOP_UNIVERSITY • 2025 • ECONOMICS • objective

A central bank is considering a monetary policy to reduce inflation. If the current inflation rate is 8% and the target inflation rate is 4%, what is the likely effect of a 2% increase in the reserve requirement on the money supply?

Answer Options

A. The money supply will increase
Correct Answer B. The money supply will decrease
C. The money supply will remain unchanged
D. The money supply will increase by 1%
Correct Answer
B
Correct Option:
The money supply will decrease

About This Question

This is Post Utme Mountain Top University 2025 Economics Question 19. It is one of the objective questions from the 2025 Post Utme Mountain Top University Economics examination.

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