Let's say that: rr = the reserve ratio = .85% C = total currency in circulation = $1060B D = total checkable deposits =$1,800B %| %3D ER = total excess reserves = $2080B %3D %3D M = money supply (M1) = C +D = $2860B Derive, numerically, the money multiplier (m); give the above values.

Economics (MindTap Course List)
13th Edition
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter13: The Federal Reserve System
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Let's say that:
rr = the reserve ratio = .85%
%3D
C = total currency in circulation = $1060B
D = total checkable deposits =$1,800B
ER = total excess reserves = $2080B
%3D
%3D
M = money supply (M1) = C + D= $2860B
%3D
Derive, numerically, the money multiplier (m); given
the above values.
Transcribed Image Text:Let's say that: rr = the reserve ratio = .85% %3D C = total currency in circulation = $1060B D = total checkable deposits =$1,800B ER = total excess reserves = $2080B %3D %3D M = money supply (M1) = C + D= $2860B %3D Derive, numerically, the money multiplier (m); given the above values.
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