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If the reserve ratio is 5 percent, then $500 of additional reserves can create up to a. $9,500 of new money. b. $2,500 of new money. c. $10,500 of new money. d. $10,000 of new m…

If the reserve ratio is 5 percent, then $500 of additional reserves can create up to a. $9,500 of new money. b. $2,500 of new money. c. $10,500 of new money. d. $10,000 of new m…
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If the reserve ratio is 5 percent, then $500 of additional reserves can create up to a. $9,500 of new money. b. $2,500 of new money. c. $10,500 of new money. d. $10,000 of new money. 1 points QUESTION 67

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User Nate Weiner
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8.4k points

1 Answer

2 votes

Divide the additional reserve by the percent:

$500 / 0.05 = $10,000

The answer is D.

answered
User Mahdad Baghani
by
8.6k points
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