Multiple Choice
The commercial banking system, because of a recent change in the required reserve ratio from 8 percent to 10 percent, finds that it is $50 million short of reserves. If it is unable to obtain any additional reserves, it must reduce
Deposits and money supply by
A) $250 million.
B) $625 million.
C) $500 million.
D) $50 million.
Correct Answer:
Verified
Correct Answer:
Verified
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