4.lf the Fed set the required reserve requirement ratio to be 0.02, bank A wishes to maintain 0.03 dollar in excess reserve for every 1 dollars in transaction deposit. What is the deposit multiplier? |(Required) If bank A found themselves with 10 in excess reserve, what is the maximum amount of new deposits (loan) created by the banking system? (Required)
4.lf the Fed set the required reserve requirement ratio to be 0.02, bank A wishes to maintain 0.03 dollar in excess reserve for every 1 dollars in transaction deposit. What is the deposit multiplier? |(Required) If bank A found themselves with 10 in excess reserve, what is the maximum amount of new deposits (loan) created by the banking system? (Required)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:4.lf the Fed set the required reserve requirement ratio to be 0.02, bank A wishes to maintain 0.03
dollar in excess reserve for every 1 dollars in transaction deposit.
What is the deposit multiplier?
(Required)
If bank A found themselves with 10 in excess reserve, what is the maximum amount of new
deposits (loan) created by the banking system?
(Required)
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