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Use the World View to answer two questions. WORLD VIEW China Cuts Reserve Requirements The People's Bank of China (PBOC) has cut the reserve requirement for small and medium-sized banks. The cut from 7 percent to 6 percent will free up 400 billion yuan ($56 billion) in reserves for the country's 4,000 affected banks, many

Use the World View to answer two questions. WORLD VIEW China Cuts Reserve Requirements The People's Bank of China (PBOC) has cut the reserve requirement for small and medium-sized banks. The cut from 7 percent to 6 percent will free up 400 billion yuan ($56 billion) in reserves for the country's 4,000 affected banks, many

Macroeconomics: Private and Public Choice (MindTap Course List)
Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter13: Money And The Banking System
Section: Chapter Questions
Problem 17CQ
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please answer a) and b)

Use the World View to answer two questions. WORLD VIEW China Cuts Reserve Requirements The People's Bank of China (PBOC) has cut the reserve requirement for small and medium-sized banks. The cut from 7 percent to 6 percent will free up 400 billion yuan ($56 billion) in reserves for the country's 4,000 affected banks, many of which serve rural areas. The reserve cuts are seen as another response to the economic calamity caused by the coronavirus pandemic. Economic lockdowns in China and around the world have hit Chinese exports hard, with GDP stalling and unemployment rising. The PBOC's cuts are intended to encourage more lending and borrowing, especially among smaller enterprises. Source: News reports, April 5-8, 2020. What was the money multiplier in China Instructions: Round your responses to two decimal places. a. before the rate cut? 56 * b. after the rate cut? 933
Transcribed Image Text:Use the World View to answer two questions. WORLD VIEW China Cuts Reserve Requirements The People's Bank of China (PBOC) has cut the reserve requirement for small and medium-sized banks. The cut from 7 percent to 6 percent will free up 400 billion yuan ($56 billion) in reserves for the country's 4,000 affected banks, many of which serve rural areas. The reserve cuts are seen as another response to the economic calamity caused by the coronavirus pandemic. Economic lockdowns in China and around the world have hit Chinese exports hard, with GDP stalling and unemployment rising. The PBOC's cuts are intended to encourage more lending and borrowing, especially among smaller enterprises. Source: News reports, April 5-8, 2020. What was the money multiplier in China Instructions: Round your responses to two decimal places. a. before the rate cut? 56 * b. after the rate cut? 933
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