The money multiplier in an economy increases when ?

The money multiplier in an economy increases when there is an increase in the reserve ratio or a decrease in the currency held by the public. When the reserve ratio is lower, banks are required to hold less reserves, allowing them to lend out more money. This increases the potential for multiple rounds of lending and increases the money multiplier. Similarly, if the amount of currency held by the public decreases, more money is available for banks to lend out, leading to an increase in the money multiplier. So, changes in the reserve ratio and currency held by the public can affect the money multiplier in an economy.