Assume that Kim deposits $1,500 in currency in the Trusty Bank. Later that same day Akio negotiates a loan for $2,000 at the same bank. What has happened to the money supply as a result of these transactions? Multiple Choice O It has increased by $500. It has decreased by $500. It has not changed.
Assume that Kim deposits $1,500 in currency in the Trusty Bank. Later that same day Akio negotiates a loan for $2,000 at the same bank. What has happened to the money supply as a result of these transactions? Multiple Choice O It has increased by $500. It has decreased by $500. It has not changed.
Chapter13: Money And The Financial System
Section: Chapter Questions
Problem 1.4P
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Transcribed Image Text:Assume that Kim deposits $1,500 in currency in the Trusty Bank. Later that same day Akio negotiates a loan for $2,000 at the
same bank. What has happened to the money supply as a result of these transactions?
Multiple Choice
O
It has increased by $500.
It has decreased by $500.
It has not changed.
Transcribed Image Text:O
O
O
It has increased by $500.
It has decreased by $500.
It has not changed.
It has decreased by $1,000.
It has increased by $2,000.
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