Suppose the currency-to-deposit ratio is 0.25, the excess reserve-to-deposit ratio is 0.05, and the required...
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Suppose the currency-to-deposit ratio is 0.25, the excess reserve-to-deposit ratio is 0.05, and the required reserve ratio is 0.10. Keep 3 decimal points. a. How much is the money multiplier? (5 marks) b. How much is the money multiplier with a rise of 0.07 in the currency-to-deposit ratio? (10 marks) c. How much is the money multiplier with a rise of 0.07 in the excess reserve-to-deposit ratio? (10 marks)
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