Although the federal reserve may increase the monetary base, the larger monetary aggregates (m1 and m2) and thus aggregate demand won't increase very much in response if:____.

Although the federal reserve may increase the monetary base, the larger monetary aggregates (m1 and m2) and thus aggregate demand won't increase very much in response if banks are slow to lend.

What is monetary aggregates?

Money aggregates are broad classifications that represent the total amount of money in an economy.

Standardized monetary aggregates in the US are given the following names:

The monetary basis, commonly referred to as the amount of physical paper and coin money in circulation plus bank reserves held by the central bank
Traveler's checks, demand deposits, and all of M0 make up M1.
M2: Every component of M1, money market securities, and savings deposits.
The Federal Reserve stopped tracking M3, a heritage aggregation that also covered time deposits above $100,000 and institutional funds, in 2006. However, some experts continue to compute it.

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