A bank deposits multiplier of 8 means that an increase in liquid assets of £1 could cause an increase in deposits of

Question

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A bank deposits multiplier of 8 implies that for every £1 increase in liquid assets, there can be an £8 increase in total deposits. This is based on the money multiplier formula in banking, which indicates how much the money supply can increase with an addition to the reserves.

A Bank Deposits Multiplier of 8 Means That an Increase