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Consider a cashless (no physical currency) economic system in which banks hold 20% of deposits as reserves. Suppose that the central bank purchases $100 million

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Consider a cashless (no physical currency) economic system in which banks hold 20% of deposits as reserves. Suppose that the central bank purchases $100 million worth of securities from the banking sector. Which of the following is the best estimate of the impact of this open market transaction on the money supply? $100 million increase in the money supply $20 million increase in the money supply o $500 million decrease in the money supply $500 million increase in the money supply

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