JAMB Economics 2018 Objective — Question 34
Question 34 of 40 from the Joint Admissions and Matriculation Board (JAMB) Economics 2018 Objective paper, with the correct answer and a full explanation.
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The initial deposit of a deposit bank is #500,000. Calculate the total amount of credit the bank can create with a cash ratio of 20%
- A. #100,000
- B. #600,000
- C. #400,000
- D. #2,500,000Correct
Explanation
Money created = Initial deposit / Cash ratio = 500,000 / 0.20 = #2,500,000.
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