Assume the Federal Reserve inserts $25,000 of reserves into the banking system (don't worry about how this is done for now). What is the maximum amount deposits will increase by assuming banks hold zero excess reserves and all currency is deposited? Please round to two decimal places where needed and do not enter the dollar sign ($).
Assume the Federal Reserve inserts $25,000 of reserves into the banking system (don't worry about how this is done for now). What is the maximum amount deposits will increase by assuming banks hold zero excess reserves and all currency is deposited? Please round to two decimal places where needed and do not enter the dollar sign ($).
Brief Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter11: The Monetary System
Section: Chapter Questions
Problem 1PA
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Assume the Federal Reserve inserts $25,000 of reserves into the banking system (don't worry about how this is done for now). What is
the maximum amount deposits will increase by assuming banks hold zero
two decimal places where needed and do not enter the dollar sign ($).
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