in a bank's business operations, at what point does the money supply increase? (banks create money; at which point in the bank's activities is the money supply increased?) 2. when (in connection with a bank) does the money supply (m1) shrink? 3. mary v deposits $100,000 in her bank, bank a. if the required reserve ratio is 1/10, and bank a had no excess reserves to start with, how much can it now lend out? 4. if the required reserve ratio (rrr) is 1/10, all banks except one have no excess reserves to start with, one bank has $10,000 in initial excess reserves, what is the maximum amount by which the banking system as a whole may increase the money supply (assuming all excess reserves are lent out (this is a money multiplier question)?
