How does the concept of the Money Multiplier effect work in fractional reserve banking systems to amplify the money supply?

What fractional reserve banking means — banks lend out most of their deposits

Fractional reserve banking allows banks to lend out a majority of their deposits while maintaining a reserve ratio

What the Keynesian multiplier effect does — $1 of government spending generates more than $1 of GDP

The Keynesian multiplier effect amplifies $1 of government spending to generate greater than $1 increase in GDP

What quantitative easing does — central bank buys assets to inject money into the economy

Quantitative easing increases money supply and stimulates economic activity

What raising interest rates does — makes borrowing more expensive, slows spending and inflation

Raising interest rates makes borrowing more expensive, slows spending, and reduces inflation

What reserve requirements do — mandate how much cash banks must hold against deposits

Reserve requirements dictate the percentage of deposits banks must keep as cash reserves

What a stock split does — increases share count while proportionally reducing price

Stock splits increase the number of shares, proportionally decreasing the price per share