Help me understand this Econom

timer Asked: Dec 3rd, 2015

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Help me understand this Economics question please, " If a single bank is holding $1,000,000 in required reserves and the reserve requirement is reduced from 25% to 20%, the bank will be able to lend what additional amount?  (Reconstructing this bank's T-account will help you answer this question.)   a.  $10,000.  f. $500,000.   b.  $50,000.  g.  $1,000,000.   c.  $100,000.  h.  $$4,000,000.   d.  $200,000.  i. $5,000,000.   e.  $250,000.  j.  Who knows? 

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