Question
Suppose that your bank's reserve ratio is 0.2 and you deposit $50,000 into the bank.Assume that the bank loans out the maximum amount it can,
Suppose that your bank's reserve ratio is 0.2 and you deposit $50,000 into the bank.Assume that the bank loans out the maximum amount it can, and people deposit all their money.What is the deposit multiplier? What is the total increase in deposits in the banking system? What is the change in the money supply?
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Economics Today The Macro View
Authors: Roger LeRoy Miller
18th Edition
0133884872, 978-0133884876
