If the reserve ratio is 100 percent, how much will the money supply eventually increase if there is a deposit of $1,000 of paper money in a bank?

Name: If the reserve ratio is 100 percent, how much will the money supply eventually increase if there is a deposit of $1,000 of paper money in a bank?
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Quizplus · Accepted Answer

If the reserve ratio is 100 percent, it means that the bank has to keep all the deposits as reserves and cannot lend any money. Therefore, the money supply will not increase at all.

If the Reserve Ratio Is 100 Percent, How Much Will