The Federal Reserve sells $28.00 million in Treasury securities. If the required reserve ratio is 30.00%, and all currency is deposited into the banking system, and banks hold excess reserves of 10%, then the maximum amount the money supply can decrease is $ _____ million. (Insert your answer in millions, and round your answer to two decimal places.)
The Federal Reserve sells $28.00 million in Treasury securities. If the required reserve ratio is 30.00%, and all currency is deposited into the banking system, and banks hold excess reserves of 10%, then the maximum amount the money supply can decrease is $ _____ million. (Insert your answer in millions, and round your answer to two decimal places.)
Chapter13: The Federal Reserve System
Section: Chapter Questions
Problem 10WNG
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The Federal Reserve sells $28.00 million in Treasury securities. If the required reserve ratio is 30.00%, and all currency is deposited into the banking system, and banks hold excess reserves of 10%, then the maximum amount the money supply can decrease is $ _____ million. (Insert your answer in millions, and round your answer to two decimal places.)
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