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Suppose that banks are required to hold reserves equal to 12 per cent of deposits and they hold no excess reserves. Also suppose that desired
Suppose that banks are required to hold reserves equal to 12 per cent of deposits and they hold no excess reserves. Also suppose that desired holdings of currency by the non-bank public are 8 per cent of deposits. If the central bank supplies an extra $25 in reserves, calculate the increase in broad money.
Given your answer to the nearest whole number.
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