What happens to the reserve if the amount falling off is lower than the amount coming on?

When the amount coming into the reserve exceeds the amount falling off, the reserve indeed increases. This situation occurs when there is a net gain, indicating that more assets or funds are being added than are being removed. This can happen in various financial contexts, such as when a company experiences higher revenues or profits than expenses or losses, leading to an accumulation of resources.

Understanding the dynamics of reserves is crucial for managing financial health effectively. When reserves increase, it typically provides the organization with greater stability and flexibility, allowing for future investments or cushioning against potential losses. Therefore, in this scenario where inflows surpass outflows, the correct inference is that the reserve goes up.