Suppose the Required Reserve Ratio Is 10% and a Depositor

question 26

Multiple Choice

Suppose the required reserve ratio is 10% and a depositor withdraws $500 from her checkable deposit. The money supply will _____ if the banking system does NOT hold any excess reserves.

• A)be unchanged
• B)decrease by $500
• C)decrease by $4,500
• D)decrease by $5,000

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Definitions:

Projects Worked

Refers to the specific tasks or assignments that an individual or team has completed or been involved with.

Simple Mistakes

Errors or oversights that are easy to make and often due to carelessness or lack of attention.

Losing Opportunity

The situation where a chance for advancement, success, or profit is missed or not taken advantage of.

Interview

A formal meeting, usually face-to-face, where one person asks questions, and the other provides answers, often used for research or employment selection.