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Paul [167]
3 years ago
14

If the currency in circulation is $500 billion, the required reserve ratio is 5 percent, checkable deposits are $700 billion, an

d excess reserves total $10 billion, then the money multiplier for the M1 is
Business
1 answer:
BARSIC [14]3 years ago
7 0

Answer:

2.35

Explanation:

The computation of the money multiplier for the M1 is shown below:

As we know that

Money supply(M1) = Currency in circulation + Checkable deposits

M1 money supply is = $500 billion + $700 billion

= $1,200 billion  

Now the M1 money multiplier is  

We know that  

Money multiplier = Money supply ÷ Monetary base

where,

Monetary base = Currency in circulation + Bank excess reserves

 = $500 billion + $10 billion

= $510 billion  

We know that,

Money multiplier = Money supply ÷ Monetary base

= $1,200 ÷ $510

= 2.35

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Correct option: A lower level of output and a higher price level.

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Bauerly Co. owned 70% of the voting common stock of Devin Co. During 2012, Devin made frequent sales of inventory to Bauerly. Th
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Answer:

                                                                         $                            $

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Add:  

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Non-controlling interest's share of Devin's net income for 2012= $45,600

Explanation:

7 0
3 years ago
A mutual fund invested in bonds with medium-length maturities. As the bonds matured, the fund reinvested the proceeds and purcha
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Answer:

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