"The money multiplier is equal to the _ in the economy divided by the original ___. a. total money;

Question

2 years ago

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"The money multiplier is equal to the _ in the economy divided by the original ___. a. total money;

quantity of money b. original quantity of reserves; reserve ratio c. quantity of money; total money d. reserve ratio; original quantity of reserves"

Business

1 answer:

weqwewe [10] · Answer 1 · 2022-02-24T07:32:25+03:00

Answer:

a. total money ; quantity of money

Explanation:

Money multiplier

Under the fractional - reserve banking system , the closely related ratios of the commercial bank money to the central bank money or the monetary base , is called the money multiplier .

It measures the maximum amount of money , that a commercial bank can make , on ignoring leakage in the currency by the non - bank public .

The value of money multiplier can be calculated as the total money in present in the economy , divided by the original quantity of money .

"The money multiplier is equal to the _______________ in the economy divided by the original _________________. a. total money;

"The money multiplier is equal to the _ in the economy divided by the original ___. a. total money;