The M1 money multiplier decreases and the money supply decreases when the required reserve ratio on checkable deposits rises, all else being equal.
<h3>What is the reserve ratio?</h3>
The percentage of deposits that commercial banks must retain in cash under the guidance of the central bank is known as the cash reserve ratio.
<h3>How is reserve ratio determined?</h3>
- The country's central bank, in the instance of the United States, the Federal Reserve, determines the reserve ratio requirement.
- The calculation for a bank can be obtained by dividing the bank deposits by the cash reserve held with the central bank, and it is expressed as a percentage.
<h3>What is an example of the reserve ratio?</h3>
The required reserve ratio is directly correlated to how much a bank expands the money supply. For instance, if a bank has deposits totaling $1,000,000 and a reserve ratio of 10%, it can lend out $900,000.
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Answer:
What do capital controls prevent?
Speculators from rushing into and out of a country's market and
disrupting its economy.
Explanation:
Capital control entails when a body that regulates money in a country controls the cash inflow and outflow
Answer:
$508.63
Explanation:
For this question, we use the Present value formula that is reflected in the attached spreadsheet. Kindly find it below:
Provided that
Given that,
Future value = $1,000
Rate of interest = 14%
NPER = 15 years
PMT = $1,000 × 6% = $60
The formula is shown below:
= -PV(Rate;NPER;PMT;FV;type)
So, after solving this, the present value is $508.63
Monopoly. A good way to remember this is that "mono" means "one" so, they are always #1 when it comes to market power.
