If the Required Reserve Ratio Is 10 Percent,what Is the Simple

question 130

Multiple Choice

If the required reserve ratio is 10 percent,what is the simple deposit multiplier?

• A) 20
• B) 100
• C) 5
• D) 10
• E) 2

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Definitions:

Net Present Value

A financial metric used to assess the profitability of an investment, calculated by subtracting the present value of cash outflows from the present value of cash inflows.

After-Tax Income

The amount of income that remains for an individual or a business after all federal, state, and withholding taxes have been deducted from taxable income.