Problem

Suppose that the statistics for the economy as a whole (in billions of $) are as follows:...

Suppose that the statistics for the economy as a whole (in billions of $) are as follows:

Currency held by the public

100

Reserves held by banks

90

Checkable deposits held at banks

800

Time deposits held at banks

200

If the demand deposit reserve requirement on checkable deposits is 10 percent and the lime deposit reserve requirement is 5 percent, what is the value of the Ml multiplier?

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Solutions For Problems in Chapter 18.A