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Suppose that r= required reserve ratio = 0.20 c = {C/D) = currency ratio = 0.30...
Suppose that r = required reserve ratio = 0.20 c = {C/D} = currency ratio =...
Suppose that r = required reserve ratio = 0.20 c = {C/D} = currency ratio = 0.45 e = {ER/D} = excess reserves ratio = 0.01 t = {T/D} = time deposit ratio = 1 mm = {MM/D} = money market fund ratio = 0.70 MB = the monetary base = $1,000 billion 1 + C + + mm Given that the formula for the M2 money multiplier is m, = - -, find the value for the M2 money...
Suppose the monetary base is $100. If the currency-deposit ratio is 0.20 and the reserve-deposit ratio...
Suppose the monetary base is $100. If the currency-deposit ratio is 0.20 and the reserve-deposit ratio is 0.10, calculate the money multiplier and total money supply.
A couple of textbook questions I'm having a tough time answering: 1.) Suppose that: r =...
A couple of textbook questions I'm having a tough time answering: 1.) Suppose that: r = required reserve ratio = 0.10 c = {C/D} = currency ratio = 0.45 e = {ER/D} = excess reserve ratio = 0.03 MB = the monetary base = $3000 billion Given that the formula for the money multiplier is (1+c/r+e+c) find the value for M, the money supply. The money supply is $____ billion. (Round your response to the nearest whole number.) Use the...
Suppose, in an economy, currency in circulation (C) is $16 billions, reserves (R) held by banks...
Suppose, in an economy, currency in circulation (C) is $16 billions, reserves (R) held by banks are $4 billions, and deposits (D) by people and firms in banks are worth $ 84 billions. If there are no excess reserves, then (a) What is the money supply (M) in the economy? _______________ (b) What is the monetary base (MB)? _______________ (c) What is the currency deposit ratio ? _______________ (d) What is the reserve deposit ratio? _______________ (e) What is the...
Suppose, in an economy, currency in circulation (C) is $16 billions, reserves (R) held by banks...
Suppose, in an economy, currency in circulation (C) is $16 billions, reserves (R) held by banks are $4 billions, and deposits (D) by people and firms in banks are worth $ 84 billions. If there are no excess reserves, then (a) What is the money supply (M) in the economy? _______________ (b) What is the monetary base (MB)? _______________ (c) What is the currency deposit ratio ? _______________ (d) What is the reserve deposit ratio? _______________ (e) What is the...
Use the information below to answer the following questions: C=currency = 1000. Deposits=D = 800. 1.1....
Use the information below to answer the following questions: C=currency = 1000. Deposits=D = 800. 1.1. = 0.1, e=excess reserve ratio = 0.25. What is the value of excess reserves, ER? What is the value of the monetary base, MB? What is the value of the money multiplier, m? What is the value of the money supply, M? e. If the required reserve ratio increases to 1.1.= 0.15, what will be the new value of the money multiplier?
14) If the desired reserve ratio is ten percent, currency in circulation is $400 billion, and...
14) If the desired reserve ratio is ten percent, currency in circulation is $400 billion, and chequable deposits are $800 billion, then the money multiplier is approximately ________. A) 2.5 B) 1.67 C) 2.0 D) 0.601 16) If the desired reserve ratio is ten percent, currency in circulation is $400 billion, chequable deposits are $800 billion, and excess reserves total $0.8 billion, then the excess reserves-chequable deposit ratio is ________. A) 0.001 B) 0.10 C) 0.01 17) If the desired...
Suppose the currency-to-deposit ratio is 0.25, the excess reserve-to-deposit ratio is 0.03, and the required reserve...
Suppose the currency-to-deposit ratio is 0.25, the excess reserve-to-deposit ratio is 0.03, and the required reserve ratio is 0.1. Which will have a larger impact on the money multiplier: a rise of 0.05 in the currency ratio or in the excess reserve ratio? Instructions: Enter your response rounded to two decimal places. If the currency-to-deposit ratio rises to 0.3, the multiplier will be m = If, instead, the excess reserve-to-deposit ratio rises, the multiplier will be m =
Suppose the monetary base is $500 million, the required reserve ratio is 12%, and the currency-deposit...
Suppose the monetary base is $500 million, the required reserve ratio is 12%, and the currency-deposit ratio is 30%. What would the excess reserve ratio need to be to produce $800 million in the money supply. Holding everything else constant, what effect would an increase in the excess reserve ratio have on the money supply?
13. Suppose the monetary base is B = $800 billion, the reserve-deposit ratio is rd =...
13. Suppose the monetary base is B = $800 billion, the reserve-deposit ratio is rd = 0.1, and the currencydeposit ratio is cd = 0.8. Calculate the value of the currency circulating in the economy (C). a. $89 billion b. $711 billion c. $889 billion d. $1,600 billion 14. Suppose the monetary base is B = $800 billion, the reserve-deposit ratio is rd = 0.1, and the currencydeposit ratio is cd = 0.8. Calculate the money multiplier (m). a. 0.5...
Suppose that r = required reserve ratio = 0.20 c = {C/D} = currency ratio = 0.45 e = {ER/D} = excess reserves ratio = 0.01 t = {T/D} = time deposit ratio = 1 mm = {MM/D} = money market fund ratio = 0.70 MB = the monetary base = $1,000 billion 1 + C + + mm Given that the formula for the M2 money multiplier is m, = - -, find the value for the M2 money...
Suppose the monetary base is $100. If the currency-deposit ratio is 0.20 and the reserve-deposit ratio is 0.10, calculate the money multiplier and total money supply.
Use the information below to answer the following questions: C=currency = 1000. Deposits=D = 800. 1.1. = 0.1, e=excess reserve ratio = 0.25. What is the value of excess reserves, ER? What is the value of the monetary base, MB? What is the value of the money multiplier, m? What is the value of the money supply, M? e. If the required reserve ratio increases to 1.1.= 0.15, what will be the new value of the money multiplier?
Suppose the monetary base is $500 million, the required reserve ratio is 12%, and the currency-deposit ratio is 30%. What would the excess reserve ratio need to be to produce $800 million in the money supply. Holding everything else constant, what effect would an increase in the excess reserve ratio have on the money supply?
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