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Suppose that in a given month $38 million is deposited into the banking system while $43 million is withdrawn. Also suppose that the Fed has
Suppose that in a given month $38 million is deposited into the banking system while $43 million is withdrawn. Also suppose that the Fed has set the reserve requirement at 20 percent and that banks have no excess reserves at the beginning of the month. What is the maximum amount of new checkable-deposit money that can be created (or removed) by the banking system as a result of these deposits and withdrawals? Instructions: Enter your answer as a whole number. Enter a positive number to show an increase and a negative number () to show a decrease. \$ million
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