Suppose the Banking System Does NOT Hold Excess Reserves and the Reserve

question 435

Multiple Choice

Suppose the banking system does NOT hold excess reserves and the reserve ratio is 25%. If Molly deposits $1,000 cash in her checking account, the banking system can increase the money supply by:

• A)$5,000.
• B)$1,000.
• C)$3,000.
• D)$4.000.

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Innovative Products

Goods or services that introduce new features, technologies, or methodologies, offering new solutions to problems or addressing unmet needs.

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The practice of using resources in a way that maximizes productivity while minimizing waste and environmental impact.

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