deposit multiplier question
Not what you're looking for? Search our solutions OR ask your own Custom question.
If banks hold a 30 percent reserve ratio, an initial increase in bank reserves of $30 will lead to an eventual:
A) increase in the money supply of $180.
B) increase in the money supply of $90.
C) increase in the money supply of $100.
D) increase in loans of $100.
E) increase in loans of $90.
https://brainmass.com/economics/banking/deposit-multiplier-question-16607
Solution Preview
This is a deposit multiplier question:
Deposit multiplier = 1 / Reserve ...
Solution Summary
A deposit multiplier question is solved.
$2.49