The economy of Elmendyn contains 900 $1 bills. If people hold all money as currency, the quantity of money is $ . If people hold all

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The economy of Elmendyn contains 900 $1 bills. If people hold all money as currency, the total quantity of money is $900. If people hold all money as demand deposits and banks maintain 100 percent reserves, the total quantity of money remains $900. If people hold equal amounts of currency and demand deposits, and banks maintain 100 percent reserves, the total quantity of money is also $900. If people hold all money as demand deposits and banks maintain a reserve ratio of 12.5 percent, the total quantity of money is $7,200. If people hold equal amounts of currency and demand deposits, and banks maintain a reserve ratio of 12.5 percent, the total quantity of money is $4,500.

Anonymous · Accepted Answer

a)    900 dollar as all is M0b)    900 as the deposit have no multiplier effectc)    900 as there is no multiplier effectd) 7,200 taking into consideration the multipler effect from the bank deposit. e) 4,050 considering the deposit multiplier effectExplanation:a; b ; c ) as there is no multiplier effect the quantity of money matches the nominal currency.d)M0 (currency and coins) 0 M1 900 / 0.125 =  7,200e) currency : 900 / 2 = 450 M0deposit : 450 / 0.125 = 3,600 M1Total 4,050

Anonymous · Answer

explanation: what

Anonymous · Answer

It will be beneficial, because it can reduce interest rates and loan terms. this means that you will be paying close to the amount you have borrowed and will have to pay little to no interest paymentshope this

Anonymous

The economy of Elmendyn contains 900 $1 bills. If people hold all money as currency, the quantity of money is $ . If people hold all

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