Final answer:
The subject of this question is Economics and the concept being discussed is the money multiplier.
Step-by-step explanation:
In the context of banking and monetary policy, the subject of your question is Economics. The specific concept you are referring to is called the money multiplier.
The money multiplier is a ratio that represents the change in the money supply of a banking system for a given change in the reserves held by banks. It is calculated by dividing 1 by the reserve requirement ratio (RRR). For example, if the RRR is 0.10 (or 10%), the money multiplier would be 10.
The money multiplier shows the potential impact of changes in reserves on the overall money supply. When banks have more reserves, they can create more loans and deposits, which increases the money supply. Conversely, if reserves decrease, banks have less capacity to create loans and deposits, leading to a decrease in the money supply.