a. If Malawians have deposited none of the currency in Malawi's banks then the size of the money supply is $[ b. If Malawians have deposited all of the currency in Malawi's banks and the banks have a 100% target reserve ratio then the si the money supply is $ c. If Malawians have deposited 45% of the currency in Malawi's banks and the banks have a 100% target reserve ratio then the the money supply is $ d. If Malawians have deposited 45% of the currency in Malawi's banks and the banks have a 12% target reserve ratio and are fll loaned up then the size of the money supply is $

Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter21: The Monetary System
Section: Chapter Questions
Problem 12PA
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The central bank of Malawi has issued $125,000 in Malawian dollars. What is the size of the money supply in each case below? Round
your answers below to the nearest whole number.
a. If Malawians have deposited none of the currency in Malawi's banks then the size of the money supply is $[
b. If Malawians have deposited all of the currency in Malawi's banks and the banks have a 100% target reserve ratio then the size of
the money supply is $
c. If Malawians have deposited 45% of the currency in Malawi's banks and the banks have a 100% target reserve ratio then the size of
the money supply is $
d. If Malawians have deposited 45% of the currency in Malawi's banks and the banks have a 12% target reserve ratio and are fully
loaned up then the size of the money supply is$|
Transcribed Image Text:The central bank of Malawi has issued $125,000 in Malawian dollars. What is the size of the money supply in each case below? Round your answers below to the nearest whole number. a. If Malawians have deposited none of the currency in Malawi's banks then the size of the money supply is $[ b. If Malawians have deposited all of the currency in Malawi's banks and the banks have a 100% target reserve ratio then the size of the money supply is $ c. If Malawians have deposited 45% of the currency in Malawi's banks and the banks have a 100% target reserve ratio then the size of the money supply is $ d. If Malawians have deposited 45% of the currency in Malawi's banks and the banks have a 12% target reserve ratio and are fully loaned up then the size of the money supply is$|
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