Suppose a Banking System Has a Required Reserve Ratio of 0.15.How

question 9

Multiple Choice

Suppose a banking system has a required reserve ratio of 0.15.How much can the money supply increase in response to a $1 billion increase in excess reserves for the whole banking system?

• A)$1 billion.
• B)$150 million.
• C)$15 billion.
• D)$6.67 billion.

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