Assume there is no leakage from the banking system and that all commercial banks are loaned up.
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Question:
Assume there is no leakage from the banking system and that all commercial banks are loaned up. The required reserve ratio is 10%. If the Fed buys $10 million worth of government securities from the public, the change in the money supply will be A) $1 million. B) $10 million. C) $100 million. D) $110 million
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