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There Is $5,000,000 of Currency in Econland, All Held by Banks

Question 81

Multiple Choice

There is $5,000,000 of currency in Econland, all held by banks as reserves.The public does not hold any currency.If the banks'desired reserve/deposit ratio is 0.25, then the money supply equals: There is $5,000,000 of currency in Econland, all held by banks as reserves.The public does not hold any currency.If the banks'desired reserve/deposit ratio is 0.25, then the money supply equals: A) $5,000,000 B) $6,250,000 C) $10,000,000 D) $20,000,000


A) $5,000,000
B) $6,250,000
C) $10,000,000
D) $20,000,000

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