Multiple Choice
Suppose the banking system has no excess reserves and the desired reserves are equal to 20 percent of chequable deposits.And suppose the Bank of Canada sells $10,000 in securities to Joe Bank Customer.What is the maximum amount that chequable deposits in the banking system could fall?
A) $2,000
B) $10,000
C) $20,000
D) $50,000
Correct Answer:
Verified
Correct Answer:
Verified
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