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PtichkaEL [24]
3 years ago
15

Select the correct answer.

Business
1 answer:
Dahasolnce [82]3 years ago
5 0
I would go with answer “c”
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5 0
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Read 2 more answers
If the reserve requirement is 25%, a new deposit of $1,000 leads to a potential increase in the money supply of
Nezavi [6.7K]

Based on the information given regarding the reserve requirements, there'll be an increase in the money supply by $4000.

A reserve requirement simply means a regulation by the Central Bank where commercial banks set a minimum amount that must be held in liquid assets.

Since the reserve requirement is 25%, a new deposit of $1,000 leads to a potential will lead to an increase in the money supply of $4000. This was calculated thus:

= $1000 / 25%

= $1000 / 0.25

= $4000

Learn more about money on:

brainly.com/question/24556197

5 0
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