Question
A bank (with no excess reserve) receives $75 million from the Federal Reserve. Use the model of multiple deposit creation with an assumption that all
A bank (with no excess reserve) receives $75 million from the Federal Reserve. Use the model of multiple deposit creation with an assumption that all banks will make full loans upto their excess reserves. If the reserve requirement is 10%, calculate the maximum deposit creation.
| $500 million | ||
| $675 million | ||
| $375 million | ||
| $750 million |
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Islamic FinanceA Practical Perspective
Authors: Nafis Alam, Lokesh Gupta, Bala Shanmugam
1st Edition
3319665588, 9783319665580
