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The fractional reserve system has a reserve requirement of 10%. The initial deposit of $1000 creates $x of the total money to M1 the money

  1. The fractional reserve system has a reserve requirement of 10%. The initial deposit of $1000 creates $x of the total money to M1 the money supply. Determine x.
  2. A company pays a dividend of $5 at the end of the year The dividend increases by 3% per annum. The interest rate is 5%. What is the value of the company?

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