If each bank in the United States had to keep 100 percent of checkable deposits as reserves, each $1 the Federal goverment injec

Question

SpyIntel [72]

3 years ago

6

If each bank in the United States had to keep 100 percent of checkable deposits as reserves, each $1 the Federal goverment injec

ted into new reserves could increase the money supply by _____.

Business

1 answer:

madreJ [45] · Answer 1 · 2022-07-03T04:17:02+03:00

Answer: money supply could increase by 100

Explanation:

Reserve requirement is a regulation by the central bank or reserve bank of a country that requires commercial banks to hold a certain percentage of funds as reserves .

When US Bank keep 100% of check able deposits as reserves that means the multiplier is 100. each $1 the federal government injects could increase the money supply by 1100