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Assume that the reserve ratio in the economy is 7%. If the Federal reserve buys bonds worth $10 million from a commercial bank, then all
Assume that the reserve ratio in the economy is 7%. If the Federal reserve buys bonds worth $10 million from a commercial bank, then all else equal, the corresponding change in deposits (following economy-wide bank-by-bank deposit expansion) equals
$10 million
$70 million
$142.86 million
$700 million
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