On a Certain Date,the Banking System Had $2 Billion in Excess

Multiple Choice

On a certain date,the banking system had $2 billion in excess reserves.The desired reserve ratio was 12.5 percent.If these funds were fully loaned out,how much could the banking system as a whole potentially increase the money supply by?

A) a maximum of $2 billion
B) a maximum of $2.5 billion
C) a maximum of $12.5 billion
D) a maximum $16 billion