How large is money supply be if required reserve ratio given
Suppose there is $120 million of cash and that half of this cash is held in bank vaults as required reserves (that is, banks hold no excess reserves). How large will the money supply be if the required reserve ratio is 10%? 12.5%? 16.2/3%?
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Assume there is $120 million of cash and that half of the cash is held in bank vaults. How large will money supply be if required reserve ratio is 10%? 12.5%? 16.2/3%?
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