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11 February, 15:19

Suppose the owners of the bank borrow $100 to supplement their existing reserves. this would increase the reserves account andincrease the account.

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  1. 11 February, 17:37
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    There will be loss due to the interest of the amount borrowed just to compensate or supplement their existing reserves.

    Total money borrowed is $100 + ($100*%interest)

    This strategy of the owner is not good and may result to more money loss than gaining more profit.
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