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zheka24 [161]
3 years ago
8

What is the relashionship between reserve ratio and interest rate spread​

Business
1 answer:
Hoochie [10]3 years ago
8 0

Answer:

The higher the reserve requirement is set, the less the amount of funds banks will have to loan out, leading to lower money creation. Alternatively, the higher the reserve requirement the, lower the supply of loanable funds, the higher the interest rate and the slower the resulting economic growth.

Explanation:

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