Business, 10.04.2020 20:25 4804174946
Suppose that there are no excess reserves in the banking system and the current amount of demand deposits is $100,000. If the monetary authorities increase the required reserve ratio from 5% to 10%:
A) the amount of excess reserves in the banking system will fall.
B) the amount of excess reserves in the banking system will remain the same.
C) the money-creating potential of the banking system will decline.
D) the money-creating potential of the banking system will rise.
Answers: 2
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