How much will the money supply increase

Reference no: EM131142054

While gardening in his backyard, Bob finds a mason jar containing $100,000 in currency. After he deposits the money in his bank, where the reserve requirement is 5 percent, by how much will the money supply eventually increase? Suppose Bob decides to keep $5,000 of his find as cash and deposits only $95,000 in his bank. By how much will the money supply increase?

Reference no: EM131142054

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