If the Required Reserve Ratio Is 10 Percent,currency in Circulation

question 122

Multiple Choice

If the required reserve ratio is 10 percent,currency in circulation is $1,200 billion,checkable deposits are $1,600 billion,and excess reserves total $2,500 billion,then the M1 money multiplier is

• A)2.5.
• B)1.7.
• C)7.3.
• D)0.73.

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