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If the reserve requirement is 10%, a new deposit of $2,000 leads to a potential increase in the money supply of: Hint: consider using the
If the reserve requirement is 10%, a new deposit of $2,000 leads to a potential increase in the money supply of: Hint: consider using the formula for money multiplier: 1) Money Multiplier=1/Reserve Requirement 2) Apply the money multiplier to the value of new deposit $20,000 $5,000 O $10,000 $15,000
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