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shepuryov [24]
3 years ago
10

Given no cash leakage and zero excess reserves held by banks, if reserves increase by $8 billion and the required reserve ratio

is 9 percent, what is the resulting change in the money supply?
Business
1 answer:
Dimas [21]3 years ago
7 0

Answer:

The answer is $88,880,000

Explanation:

Multiplier effect = 1 / required reserve ratio

Required reserve ratio = 9 percent

Multiplier effect is therefore;

1/0.09

=11.11

Change is money supply is increase in reserve multiplied by multiplier effect

Increment in reserve = $8milion

11.11 x 8million

=$88,880,000

So, resulting change in the money supply is $88,880,000

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Answer:

false

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3 years ago
The team members of the technical team in Wescrult Inc. are working on a crucial project. Their previous manager assigned respon
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Why is it false that we learn about gods relationship with the people of Israel in the new testament
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A 60-year old retiree is in a very low tax bracket. He has a low risk tolerance and wishes to make an investment that will provi
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Complete Question:

A 60-year old retiree is in a very low tax bracket. He has a low risk tolerance and wishes to make an investment that will provide income. Which is the BEST recommendation?

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Answer:

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Explanation:

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