If the commercial banking system's excess reserves are zero and the reserve requirement is 10 percent,in order for the banking system to increase deposits by $2.5 million,the Bank of Canada must

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When the Bank of Canada buys $250,000 of government securities from the public, it injects that amount into the banking system. With a 10 percent reserve requirement, this initial injection can support an increase in deposits of up to $2.5 million, through the money multiplier effect.

If the Commercial Banking System's Excess Reserves Are Zero and the Reserve