Now, suppose that, rather than immediately lending out all excess reserves, banks begin holding some excess reserves due to uncertain economic conditions. Specifically, banks increase the percentage of deposits held as reserves from 10% to 20%. This increase in the reserve ratio causes the money multiplier to to . Under these conditions, the Fed would need to . $ worth of U. S. government bonds in order to increase the money supply by $100.

fall5buy$20

Explanation:

when the reserve ratio of a bank is increased the money multiplier will decrease ( fall ) since the reserve ratio increased to 20% the money multiplier which is calculated as = I / reserve  will now become  

= 1 / 0.2 = 5

To increase the money supply to $100 since the banks increased the reserve ratio of the bank the government will need to buy the required bond.

to get the actual value of the required bond = the required increase / money multiplier = $100 / 5 = $20

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