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reserve requirements have less predictable effects

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Suppose you borrow $15,000 and then repay the loan by making 12 monthly payments of $1,297.92 each. What rate will you be quoted on the loan? What is the effective annual rate you are paying?

Why do changes in reserve requirements have less predictable effects on the money supply in comparison to changes in open market operations?

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This solution discusses reserve requirements.

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Rate I was quoted: 1297.92/15000 = 8.65%
Effective annual rate 6.7875= 7.003%

Because changes in reserve ...

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