Suppose the Federal Reserve increased deposits by $100 billion,but the reserve requirement on all deposits was 100%.What impact would the change in deposits have on the money supply?
A) The money supply would increase by $100 billion.
B) The money supply would increase by an infinite amount.
C) The money supply would decrease by $100 billion.
D) The money supply would decrease by an infinite amount.
E) The money supply would not change.
Correct Answer:
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