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if the federal reserve decreases the reserve rate from 10% to 8%, how does this affect the amount of money that would result because of fractional reserve banking from an initial deposit into the bank of $40,000

Respuesta :

lightcaps298

40,000 divided by 0.08= 500,000

40,000 divided by 0.10= 400,000

So...

500,000- 400,000= $100,000

Answer is:

$100,000

Increases by $100,000.

Hope this helps, have a good day. c;

abiolataiwo2015

The amount of money that would result because of fractional reserve banking from an initial deposit is affected by: It increases the amount by $100,000.

What is reserve?

Using this formula

Reserve=(Initial deposit/Reserve rate)- (Initial deposit/Reserve rate)

Let plug in the formula

Reserve=(40,000/ 0.08)- (400,000/0.10)

Reserve=$500,000-$400,000

Reserve=$100,000 increase

Therefore  It increases the amount by $100,000.

Learn more about reserve here:https://brainly.com/question/25817380

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