Suppose that the excess reserves in Toronto Dominion Bank increase by $700. Given a desired reserve ratio of 2.5 percent and no cash drain, the maximum change in deposits for the entire banking system would be
A) $682.50.
B) $70 000.00.
C) $28 000.00.
D) $700.00.
E) $17 500.00.
Correct Answer:
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