Assume the First Bank of Townsville makes a loan of $2,500.This loan will
A) increase the quantity of money initially by $2,500.
B) decrease the quantity of money initially by $2,500.
C) have no change on the quantity of money,just its composition.
D) increase the First Bank of Townville's liabilities at the Fed.
E) increase the First Bank of Townville's reserves.
Correct Answer:
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