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lesya692 [45]
2 years ago
7

Assume that the banking system has total reserves of $100 billion. Assume also that required reserves are 10 percent of checking

deposits and that banks hold no excess reserves and households hold no currency. Calculate the money multiplier and money supply for this banking system.
Business
1 answer:
ivolga24 [154]2 years ago
5 0

Answer:

The money multiplier and money supply for this banking system is 10 and $1,000 billion respectively

Explanation:

The computation of the money multiplier and the money supply is shown below:

As we know that

Money multiplier is

= 1 ÷ required reserve ratio

= 1 ÷ 0.10

= 10

So, the money supply is

= Total Reserves × Money Multiplier

= $100 billion × 10

= $1,000 billion

hence, the money multiplier and money supply for this banking system is 10 and $1,000 billion respectively

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maksim [4K]

Answer:

Insurance is the procedure by which persons or companies exposed to a specific risk agree with an institution specializing in compensation for damage that the institution will indemnify the damage caused when the risk materializes. The resulting contract is called insurance.

From a commercial point of view, insurance can be defined as the means by which the cost of incidental damage can be converted evenly into a continuous annual cost on an annual basis.

5 0
2 years ago
Four years ago, a popular sandwich company used to sell 12-inch roast beef subs for only $5, but the same product now costs $7.6
Alex17521 [72]

Answer:

11.36%

Explanation:

Divide the new price of roast beef with the old one. 7.69 / 5

7.69 ÷ 5 = 1.538

Also divide 1 with the number of years inflation occur

1 ÷ 4 = 0.25

Next, is to raise the first answer gotten to the power of second.

1. 538 ^ 0.25 = 1.113625

Subtract from from 1

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8 0
3 years ago
The marketing team at an electronics company felt strongly that their new product needed to be available by the first quarter in
zloy xaker [14]

Answer:

different time horizon

Explanation:

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3 0
3 years ago
Allison's requires $180,000 to fund a new project next year. The firm expects to earn excess cash of $68,000 this year after all
liraira [26]

$0 is needed

<u>Explanation:</u>

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Therefore, there should be no equity capital that should be raised in order to fund the project.

The correct answer is $0 equity.

4 0
2 years ago
Why is high quality bond typically considered a lower risk investment than a stock
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A bond typically pays a fixed, predictable amount of interest each year.
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