4. Suppose Bantam Bank has excess reserves of $8,000 and checkable deposits of $150,000. If the required reserve ratio is 20%. a. What is the size of the bank's actual reserves? b. If Bob deposits $10,000 into the bank, how much will the money supply increase? c. What is the money multiplier for this banking system?

Answer rating: 100% (QA)

To solve this problem well use the formulas for calculating actual reserves the money supply increas... View the full answer