Describe money supply in banking system?

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Reference no: EM13173805

While Bob was walking in the park, he found a $ 100 bill. Not finding the owner, he decided to deposit it in his checking account. The banks have no excess reserves and required reserve ratio is 25 %

a. How did it change M1 initially?

b.How much money can his bank lend out initially?

c.How much total money supply will change eventually in the whole banking system?

Reference no: EM13173805

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