If the Target Reserve Ratio in the Banking System Is

question 52

Multiple Choice

If the target reserve ratio in the banking system is 1 percent, there is no cash drain, and there are no excess reserves, a new deposit of $1 will lead to an expansion of the money supply of

• A)$0.01
• B)$1.10
• C)$1.00
• D)$10.00
• E)$100.00