If the Reserve Ratio Is 100-Percent, Then a New Deposit

question 37

Multiple Choice

If the reserve ratio is 100-percent, then a new deposit of $500 into a bank account

• A)eventually increases the money supply by $500.
• B)leaves the size of the money supply unchanged.
• C)eventually decreases the size of the money supply by $500.
• D)None of the above is correct.

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Definitions:

Suppliers

Businesses or individuals that provide goods or services to another business, often as part of a supply chain.