Singular Savings Bank received an initial deposit of $3000. It kept a percentage of this money in reserve based on the reserve rate and loaned out the rest. The amount it loaned out was eventually all deposited back into the bank. If this cycle continued indefinitely and eventually the $3000 turned into $50,000, w

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Mathematics

Jesse

11 July, 08:10

Singular Savings Bank received an initial deposit of $3000. It kept a percentage of this money in reserve based on the reserve rate and loaned out the rest. The amount it loaned out was eventually all deposited back into the bank. If this cycle continued indefinitely and eventually the $3000 turned into $50,000, w

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Braxton Garner · Answer 1

basically tweaking the reserve rate until at the 260th iteration the Total Money Deposited approached $50,000. The reserve amount is 6%, so that 94% of the 3,000 is loaned out, which would be 2,820, and then 94% of that is loaned out which is 2,650.80, and so forth.