Scenario 1

Scenario 1:
Initial Deposit =
5,000
Reserve requirement =
10%
Money Multiplier =
10
How many banks will it take to go through the multiplier process?
89
What will the Total New Deposits be?
50,000
How much in Total Excess Reserves will there when the multiplier process
45,000 completes?
How much money will be created?
45,000
Bank
number
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38

New
Deposits
5,000
4,500
4,050
3,645
3,281
2,952
2,657
2,391
2,152
1,937
1,743
1,569
1,412
1,271
1,144
1,029
927
834
750
675
608
547
492
443
399
359
323
291
262
236
212
191
172
155
139
125
113
101

Required
Excess
Reserves
Reserves
500
4,500
450
4,050
405
3,645
364.5
3,281
328.05
2,952
295.245
2,657
265.7205
2,391
239.14845
2,152
215.233605
1,937
193.7102445
1,743
174.3392201
1,569
156.905298
1,412
141.2147682
1,271
127.0932914
1,144
114.3839623
1,029
102.945566
927
92.65100944
834
83.3859085
750
75.04731765
675
67.54258588
608
60.7883273
547
54.70949457
492
49.23854511
443
44.3146906
399
39.88322154
359
35.89489938
323
32.30540945
291
29.0748685
262
26.16738165
236
23.55064349
212
21.19557914
191
19.07602122
172
17.1684191
155
15.45157719
139
13.90641947
125
12.51577752
113
11.26419977
101
10.1377798
91

Scenario 1
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89

91
82
74
67
60
54
48
44
39
35
32
29
26
23
21
19
17
15
14
12
11
10
9
8
7
7
6
5
5
4
4
3
3
3
3
2
2
2
2
1
1
1
1
1
1
1
1
1
1
1
0
44,996

9.124001816
8.211601634
7.390441471
6.651397324
5.986257591
5.387631832
4.848868649
4.363981784
3.927583606
3.534825245
3.181342721
2.863208449
2.576887604
2.319198843
2.087278959
1.878551063
1.690695957
1.521626361
1.369463725
1.232517352
1.109265617
0.998339056
0.89850515
0.808654635
0.727789171
0.655010254
0.589509229
0.530558306
0.477502475
0.429752228
0.386777005
0.348099305
0.313289374
0.281960437
0.253764393
0.228387954
0.205549158
0.184994243
0.166494818
0.149845336
0.134860803
0.121374723
0.10923725
0.098313525
0.088482173
0.079633955
0.07167056
0.064503504
0.058053154
0.052247838
0.047023054
4499.576793

82
74
67
60
54
48
44
39
35
32
29
26
23
21
19
17
15
14
12
11
10
9
8
7
7
6
5
5
4
4
3
3
3
3
2
2
2
2
1
1
1
1
1
1
1
1
1
1
1
0
0
40,496