Suppose that the required reserve ratio is 50 percent and you withdraw $425000 from Comerica Bank. a. What is the deposit multiplier? b. What is the total decrease in deposits in the banking system? c. What is the change in the money supply?
Suppose that the required reserve ratio is 50 percent and you withdraw $425000 from Comerica Bank. a. What is the deposit multiplier? b. What is the total decrease in deposits in the banking system? c. What is the change in the money supply?
Chapter25: Money Creation
Section: Chapter Questions
Problem 9SQP
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