Assume That When $100 of New Reserves Enter the Banking

question 31

True/False

Assume that when $100 of new reserves enter the banking system, the money supply ultimately increases by $625. Assume also that no banks hold excess reserves and that the entire money supply consists of bank deposits. If, at a point in time, reserves for all banks amount to $500, then at that same point in time, loans for all banks amount to $2,625.

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Definitions:

Dispersion

Refers to the degree of variation or spread of data points in a dataset.

Range

The difference between the highest and lowest values in a set of data, indicating the spread or dispersion of the data points.

Interquartile Range

A measure of statistical dispersion, representing the difference between the upper (75th percentile) and lower (25th percentile) quartiles in a dataset.