Deposit on the entire banking system, Accounting Basics

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Deposit on the entire banking system

Problem:

What is the impact of a $2,000 deposit on the entire banking system (money supply impact) assuming that the required reserve ratio is 5% and banks have no desire to hold excess reserves.

Note: Please provide through step by step calculations.

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Accounting Basics: Deposit on the entire banking system

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Accounting Basics: Deposit on the entire banking system

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