Question: EXERCISE 1. = Use the simple deposit multiplier AD = (1/rr) * AR to calculate the change in deposits given the following conditions: Required Reserve

EXERCISE 1. = Use the simple deposit multiplier AD = (1/rr)

EXERCISE 1. = Use the simple deposit multiplier AD = (1/rr) * AR to calculate the change in deposits given the following conditions: Required Reserve Ratio Change in Reserves Answer: Change in Deposits .1 10 100 .5 10 20 1 10 10 .1 -10 -100 .1 100 1,000 0 43.5 ERRORcannot divide by 0

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