Scenario 1:

Initial Deposit = 5,000

Reserve requirement = 10%
Money Multiplier = 10.00
How many banks will it take to go through the multiplier process? 132
What will the Total New Deposits be? 49,999.95
How much in Total Excess Reserves will there when the multiplier process completes? 44,999.96
How much money will be created? 44,999.96

Bank number New Required Excess

Deposits Reserves Reserves

1 5,000.00 500.00 4,500.00

2 4,500.00 450.00 4,050.00
3 4,050.00 405.00 3,645.00
4 3,645.00 364.50 3,280.50
5 3,280.50 328.05 2,952.45
6 2,952.45 295.25 2,657.21
7 2,657.21 265.72 2,391.48
8 2,391.48 239.15 2,152.34
9 2,152.34 215.23 1,937.10
10 1,937.10 193.71 1,743.39
11 1,743.39 174.34 1,569.05
12 1,569.05 156.91 1,412.15
13 1,412.15 141.21 1,270.93
14 1,270.93 127.09 1,143.84
15 1,143.84 114.38 1,029.46
16 1,029.46 102.95 926.51
17 926.51 92.65 833.86
18 833.86 83.39 750.47
19 750.47 75.05 675.43
20 675.43 67.54 607.88
21 607.88 60.79 547.09
22 547.09 54.71 492.39
23 492.39 49.24 443.15
24 443.15 44.31 398.83
25 398.83 39.88 358.95
26 358.95 35.89 323.05
27 323.05 32.31 290.75
28 290.75 29.07 261.67
29 261.67 26.17 235.51
30 235.51 23.55 211.96
31 211.96 21.20 190.76
32 190.76 19.08 171.68
33 171.68 17.17 154.52
34 154.52 15.45 139.06
35 139.06 13.91 125.16
36 125.16 12.52 112.64
37 112.64 11.26 101.38
38 101.38 10.14 91.24
39 91.24 9.12 82.12
40 82.12 8.21 73.90
41 73.90 7.39 66.51
42 66.51 6.65 59.86
43 59.86 5.99 53.88
44 53.88 5.39 48.49
45 48.49 4.85 43.64
46 43.64 4.36 39.28
47 39.28 3.93 35.35
48 35.35 3.53 31.81
49 31.81 3.18 28.63
50 28.63 2.86 25.77
51 25.77 2.58 23.19
52 23.19 2.32 20.87
53 20.87 2.09 18.79
54 18.79 1.88 16.91
55 16.91 1.69 15.22
56 15.22 1.52 13.69
57 13.69 1.37 12.33
58 12.33 1.23 11.09
59 11.09 1.11 9.98
60 9.98 1.00 8.99
61 8.99 0.90 8.09
62 8.09 0.81 7.28
63 7.28 0.73 6.55
64 6.55 0.66 5.90
65 5.90 0.59 5.31
66 5.31 0.53 4.78
67 4.78 0.48 4.30
68 4.30 0.43 3.87
69 3.87 0.39 3.48
70 3.48 0.35 3.13
71 3.13 0.31 2.82
72 2.82 0.28 2.54
73 2.54 0.25 2.28
74 2.28 0.23 2.06
75 2.06 0.21 1.85
76 1.85 0.18 1.66
77 1.66 0.17 1.50
78 1.50 0.15 1.35
79 1.35 0.13 1.21
80 1.21 0.12 1.09
81 1.09 0.11 0.98
82 0.98 0.10 0.88
83 0.88 0.09 0.80
84 0.80 0.08 0.72
85 0.72 0.07 0.65
86 0.65 0.06 0.58
87 0.58 0.06 0.52
88 0.52 0.05 0.47
89 0.47 0.05 0.42
90 0.42 0.04 0.38
91 0.38 0.04 0.34
92 0.34 0.03 0.31
93 0.31 0.03 0.28
 94 0.28 0.03 0.25
95 0.25 0.02 0.22
96 0.22 0.02 0.20
97 0.20 0.02 0.18
98 0.18 0.02 0.16
99 0.16 0.02 0.15
100 0.15 0.01 0.13
101 0.13 0.01 0.12
102 0.12 0.01 0.11
103 0.11 0.01 0.10
104 0.10 0.01 0.09
105 0.09 0.01 0.08
106 0.08 0.01 0.07
107 0.07 0.01 0.06
108 0.06 0.01 0.06
109 0.06 0.01 0.05
110 0.05 0.01 0.05
111 0.05 0.00 0.04
112 0.04 0.00 0.04
113 0.04 0.00 0.03
114 0.03 0.00 0.03
115 0.03 0.00 0.03
116 0.03 0.00 0.02
117 0.02 0.00 0.02
118 0.02 0.00 0.02
119 0.02 0.00 0.02
120 0.02 0.00 0.02
121 0.02 0.00 0.01
122 0.01 0.00 0.01
123 0.01 0.00 0.01
124 0.01 0.00 0.01
125 0.01 0.00 0.01
126 0.01 0.00 0.01
127 0.01 0.00 0.01
128 0.01 0.00 0.01
129 0.01 0.00 0.01
130 0.01 0.00 0.01
131 0.01 0.00 0.01
132 0.01 0.00 0.00
133 0.00 0.00 0.00
 Scenario 2:
Initial Deposit = 5,000
Reserve requirement = 40%
Money Multiplier = 2.5
How many banks will it take to go through the multiplier process? 28
What will the Total New Deposits be? 12,500
How much in Total Excess Reserves will there when the multiplier process completes? 7,500
How much money will be created? 7,500

Bank number New Required Excess

Deposits Reserves Reserves

1 5,000.00 2,000.00 3,000.00

2 3,000.00 1,200.00 1,800.00
3 1,800.00 720.00 1,080.00
4 1,080.00 432.00 648.00
5 648.00 259.20 388.80
6 388.80 155.52 233.28
7 233.28 93.31 139.97
8 139.97 55.99 83.98
9 83.98 33.59 50.39
10 50.39 20.16 30.23
11 30.23 12.09 18.14
12 18.14 7.26 10.88
13 10.88 4.35 6.53
14 6.53 2.61 3.92
15 3.92 1.57 2.35
16 2.35 0.94 1.41
17 1.41 0.56 0.85
18 0.85 0.34 0.51
19 0.51 0.20 0.30
20 0.30 0.12 0.18
21 0.18 0.07 0.11
22 0.11 0.04 0.07
23 0.07 0.03 0.04
24 0.04 0.02 0.02
25 0.02 0.01 0.01
26 0.01 0.01 0.01
27 0.01 0.00 0.01
28 0.01 0.00 0.00
29 0.00 0.00 0.00