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Suppose commercial banks have no excess reserves then new

Suppose commercial banks have no excess reserves. Then new deposits totaling $1 billion come into the banking system. If the required reserve ratio is 20 percent, what is the maximum amount by which banks can increase deposits in the entire system?

A. $0.5 billion

B. $5.0 billion

C. $2.0 billion

D. $2.5 billion

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Business Economics: Suppose commercial banks have no excess reserves then new

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