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25 May, 23:51

If the federal reserve deceases the reserve rate from 5% to 2%, how does this affect the amount of money that would result because of fractional reserve banking from an initial deposit into a bank of 25,000

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  1. 26 May, 01:51
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    25,000:0.05

    =500,000

    25,000:0.02

    =1,250,000

    increased by

    1,250,000-500,000

    =750,000
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