If Bank Reserves Are 200, the Public Holds 400 in Currency

question 93

Multiple Choice

If bank reserves are 200, the public holds 400 in currency, and the desired reserve-deposit ratio is 0.25, the deposits are ________ and the money supply is ________.

• A)200; 600
• B)400; 800
• C)600; 1,000
• D)800; 1,200