When answering this question, don't round up your answer. Suppose that for each additional dollar of excess reserves, the money supply increases by 18. If a commercial bank converts any excess reserves into new loans, what is the value of new loans made by this bank after a $61212 deposit? 57{ How much must this commercial bank keep as reserves of a new $61212 deposit? 341
When answering this question, don't round up your answer. Suppose that for each additional dollar of excess reserves, the money supply increases by 18. If a commercial bank converts any excess reserves into new loans, what is the value of new loans made by this bank after a $61212 deposit? 57{ How much must this commercial bank keep as reserves of a new $61212 deposit? 341
Chapter25: Money Creation
Section: Chapter Questions
Problem 9SQP
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