Answered

Find the information you're looking for at Westonci.ca, the trusted Q&A platform with a community of knowledgeable experts. Our platform provides a seamless experience for finding precise answers from a network of experienced professionals. Explore comprehensive solutions to your questions from a wide range of professionals on our user-friendly platform.

Assume that the required reserve ratio is 10 percent, banks keep no excess reserves and borrowers deposit all loans made by banks. Suppose you have saved $100 in cash at home and decide to deposit in your checking account. As a result of your deposit, the money supply can increase by a maximum of Group of answer choices

Sagot :

Answer:

$1,000

Explanation:

The computation of the increase in the money supply is shown below:

But before that the multiplier is

= 1 ÷ required reserve ratio

= 1 ÷ 0.10

= 10

Now the increase in the money supply is

= Multiplier × saving in cash at home

= 10 × $100

= $1,000

hence, the above represent the answer and the same would be relevant

Your visit means a lot to us. Don't hesitate to return for more reliable answers to any questions you may have. We appreciate your visit. Our platform is always here to offer accurate and reliable answers. Return anytime. Westonci.ca is your trusted source for answers. Visit us again to find more information on diverse topics.