Use the Following to Answer Questions

question 364

Multiple Choice

Use the following to answer questions:
Suppose that the public holds 50% of the money supply in currency and the reserve requirement is 20%.Banks hold no excess reserves.A customer deposits $6000 in her chequable deposit.
-(Scenario: Holding Cash) Refer to Scenario: Holding Cash. The money multiplier is:

• A)2.
• B)greater than 5.
• C)5.
• D)less than 5.

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