(Answered) What will happen to the money supply under the following

Economics

What will happen to the money supply under the following circumstances in the banking system?

a. When the required reserve ratio is 20% and a customer deposits $700 in her checkable bank deposit, the money supply will potentially (increase, decrease) ________ by $ ________.

b. When the required reserve ratio is 10% and a customer withdraws $700 from her checkable bank deposit, the money supply will potentially (increase, decrease) ________ by $ ________.

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Business Economics, Economics

Category:- Business Economics
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