In June 2014, individuals and businesses held:• $50 billion in currency• $1,000 billion in chequable deposits$5,000 billion in non-chequable deposits$750 billion in fixed term deposits and other deposits•1In June 2014, banks held:$450 billion in currency$100 billion in reserves at the central bank$800 billion in loans to households and businesses. Use the information given on the right to make the following calculations.1. Calculate the M1 and M2 measures of money.M1 is $1050 billion.M2 is $6800 billion.2. Calculate the monetary base.The monetary base is $ 600 billion.3. What are the currency drain ratio and the banks'reserve ratio?The currency drain ratio ispercent and the banks' reserve ratio is 13.3 percent.

M1 is the narrowest measure of money supply and includes currency in circulation and demand…

1. Calculate the M1 and M2 measures of money. M1 is $ 1050 billion. M2 is $ 6800 billion. 2. Calculate the monetary base. The monetary base is $ 600 billion. 3. What are the currency drain ratio and the banks' reserve ratio? The currency drain ratio is percent and the banks' reserve ratio is 13.3 percent.

1. Calculate the M1 and M2 measures of money. M1 is $ 1050 billion. M2 is $ 6800 billion. 2. Calculate the monetary base. The monetary base is $ 600 billion. 3. What are the currency drain ratio and the banks' reserve ratio? The currency drain ratio is percent and the banks' reserve ratio is 13.3 percent.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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