What would be the amount of deposits D, given that the monetary base MB $750 billion, the required reserve rate (r) -0.1, the ex
cess reserve rate (ERID) 0.005, and non-bank currency to deposits (CID) equaled 1.2?
1 answer:
Answer:
$574.71 billion.
Explanation:
The formula for calculating amount of deposits is as follows:

where,
D = Deposits
rr = required reserve rate
ER/D = excess reserve rate
C/D = non-bank currency to deposits

D = 574.712644
D = 574.71
Therefore, the amount of deposits is $574.71 billion.
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