athenadailey7369 athenadailey7369
  • 15-08-2020
  • Business
contestada

If the required reserve ratio is 10% and the Fed buys $5 billion worth of securities, then the maximum potential change in the money supply will be a(n):

Respuesta :

ewomazinoade ewomazinoade
  • 16-08-2020

Answer:

increase in money supply by $50 billion

Explanation:

required reserve ratio is the ratio of deposits that banks must keep with the central bank as reserves.

If the FED buys securities money supply would increase.

change in money supply = amount / required reserve ratio

= $5 billion / 0.1 = $50 billion

Answer Link

Otras preguntas

x/3 + 1 = 4 Please help me with full step by step explanation
2. A ladder 16cm long weighs 420N and it's centre of gravity is 7m from one end.It is carried horizontally by two boys,each holding it 1m from the ends. Show th
In the figure below, find the value of cose: 8 -|- -|X X|L A. 1 О в.г OC. 1 O D. X
The ascending colon is_____ to the small intestine The ileum is_____ to the colon. The descending colon is_____ to sigmoid colon The greater omentum is_____to s
Write a letter to your parents to convince them to go on a trip
1. a) if 60%% students passed in Physics, 55% pass in Math and 40% fail in both subjects, what percent of students are pass in both subjects?​
The ratio of the lengths of corresponding sides of similar triangles is 3/8. What is the ratio (smaller to larger) of the areas?​
3/5÷8/9How to know what to do next? give solution with steps​
what is the theme of Paddington Bear
Anthropology has three unique qualities. What are they and explain each one using specific examples.