The required reserve ratio for jack's bank is 10 percent. if jack deposits $2,000 cash in his checking account, what is the amount of new money the bank would create when it lends out its excess reserves?

Jack deposits $2000, given 10% required reserves, the bank has to keep 10% of $2000 in reserves with the central bank.

Thus,

Excess reserves for loaning out = $2000 - $200 =$1800

The increase in money supply can be found out by using the money multiplier formula.

Therefore,

Thus, the money supply increases by $20,000.

answer; 33,000;

answer(d) all of the choices are correct;