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What is the required reserve ratio in this economy

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Reference no: EM13330946

Suppose that the deposit multiplier in a particular economy is 5. In this simple economy, banks hold no excess reserves and the public uses checking deposits rather than holding currency.

What is the required reserve ratio in this economy?

A. 0.25

B. 25

C. 10

D. 50

E. 0.20

F. 5

Reference no: EM13330946

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