Why do banks choosing to hold excess reserves or borrowers choosing to hold some of their loans
Question:
Why do banks choosing to hold excess reserves or borrowers choosing to hold some of their loans in the form of currency reduce the actual impact of the money multiplier below that indicated by the multiplier formula?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 66% (3 reviews)
If banks choose to hold excess reserves each bank involved in the proc...View the full answer
Answered By
Mugdha Sisodiya
My self Mugdha Sisodiya from Chhattisgarh India. I have completed my Bachelors degree in 2015 and My Master in Commerce degree in 2016. I am having expertise in Management, Cost and Finance Accounts. Further I have completed my Chartered Accountant and working as a Professional.
Since 2012 I am providing home tutions.
3.30+
2+ Reviews
10+ Question Solved
Related Book For
Question Posted:
Students also viewed these Business questions
-
Why do banks want to maintain as little excess reserves as possible? Under what circumstances might banks desire to hold excess reserves?
-
Why do leakages reduce the money multiplier from its potential?
-
Why would a bank ever hold excess reserves rather than make new loans?
-
Danone will make a euro 95 million acquisition in Ethiopia, paid in three equal instalments of Ethiopian Birr in 6,12 and 24 months. The spot rate for Birr is 47.9 and one year and two year forward...
-
The Harvard University Institute of Politics surveys undergraduates across the United States annually. Responses to the question When it comes to voting, do you consider yourself to be affiliated...
-
According to Pew Research Center surveys, 8% of American adults did not own a cell phone in 2015. Suppose Verizon Wireless would like to test if this percentage has recently changed. A recent random...
-
Consider a parallel-plate capacitor with charge \(+q\) on the top plate and \(-q\) on the other, and a plate area that is large relative to the separation distance. Contrast this with a spherical...
-
Using 360 days as the denominator, calculate interest for the following notes using the formula I = P R T. Principal Rate Time Interest 6.00% 7.50 $5,000 1,000 4,500 950 30 days 60 120 8.00 6.80...
-
3. You purchased a 3 year coupon bond one year ago. Its par value is $1,000 and coupon rate is 6%, paid annually. At the time you purchased the bond, its yield to maturity was 6.5%. Suppose you sell...
-
If the Fed raised the discount rate from 1 to 2 percent, what effect would this have on the money supply?
-
Evaluate dz using the given information. N 11 y + 3x 2 - X ; x = 4, y 4, y = -4, dx = 0.01, dy = 0.03
-
The Greek Connection had sales of $32 million and a cost of goods sold of $12.8 million in 2015. A simplified balance sheet for the firm appears below: a. Calculate The Greek Connections net working...
-
The DSB-LC (conventional AM) signal waveform is given in Figure below, based on the figure find the power efficiency. The modulating signal is a sinusoidal signal." 2 0 -2 43.8% - 33.33% O 11.11%...
-
What's the analysis of this pneumatic circuit? Stage 5 H Single Input Flip-Flop & Reverse Cycuit 4 12 0 10 Part # 1 6,10 2,5,9 3,7,11 12,13 4,8 14 Model # MAV-4D MAV-4 MPA-3 MFC-2 MSV-1 Model Type...
-
It is assumed that you already have installed the Xampp software and have pasted the required folder in the htdocs directory of the xampp folder in C drive. Question No. 1 1- Make sure the Apache...
-
and 10 B=0,+r cosa,+a, in cartesian and cylindrical coordinates Express the vector and find B=(-3,4,0) Two blocks of masses 10kg and 20kg are placed on the x-axis. The first mass is moved on the axis...
-
Most daily newspapers include mutual fund quotes in the financial section, but not all mutual funds are listed every day. Listings for open-end mutual funds are usually organized by fund family...
-
Consider the cylindrical container treated in Example 7.4.3. Suppose the outlet flow is turbulent. Derive the dynamic model of the system (a) In terms of the gage pressure p at the bottom of the tank...
-
Define cultural intelligence. Cite the books or journal articles you found in Capella's library. Explain why cultural intelligence is important for HR practitioners and other organizational managers.
-
According to an opinion column in the Wall Street Journal, Directors need to be held more accountable when they fail to set the proper tone at the top, and right now there is almost no consequence...
-
In a study of general incorporation laws in the United States, Eric Hilt of Wellesley College noted, Prior to the adoption of a general statute, a business could only incorporate if the state passed...
-
Briefly explain whether you agree with the following statement: The total value of the shares of Microsoft stock traded on the Nasdaq last week was $895 billion, so the firm actually received much...
-
a. What is the cost of the following preferred stock? Dividend 5.41 per share; Price 48.73 per share. b. What is the cost of the following preferred stock? Price per share: 87.77; Dividend: 3.45. c....
-
A Scotch Company had cash basis net income of $100,000 during 2020. in preparing accrual basis Income statements, the firm determined that Supplies were 55,000 at the beginning of the year and $8,000...
-
An organization needs to add vendor resources to a project, but they do not have the physical space to house the team. What approach should the organization use for their personnel management?
Study smarter with the SolutionInn App