Question

If the required reserve ratio is 10 percent, a $100 deposit will ultimately allow the banking system to create how much money?

Answer 1

If the required reserve ratio exists 10 percent, a $100 deposit will ultimately allow the banking system to create $1,000.

What is the banking system?

A network or collection of institutions that offer financial services makes up a banking system. Commercial, national, and investment banks as well as credit unions might be a part of one of the main categories of banking systems.

The whole financial system depends on the banking sector. Offering infrastructure, financing, and investment has an impact on the national economy. The backbone of the world's economies is the banking sector. Any nation's economic development and growth are greatly influenced by its banking industry.

From the given information in the question, we get

1 / 100 = 10

100 x 10 = 1,000

If the required reserve ratio exists 10 percent, a $100 deposit will ultimately allow the banking system to create $1,000.

To learn more about the banking system refer to:

brainly.com/question/24122638

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