Question: Hello: Please help me with this problem? Thanks Supposed the economy has a total of $5,000 in $1 bills. if people hold all the money
Hello:
Please help me with this problem?
Thanks
Supposed the economy has a total of $5,000 in $1 bills.
if people hold all the money as currency what is the quantity of money.
Currency+Deposit-5000+0=5000 ?
f people hold all the money as demand deposits and banks maintain a 5% reserve ratio what is the quantity of money.
(20) (5000)=100.000. ? But i am confused because if people hold their money there is no deposit right?
This one i do not know how to do? Can you help me? thank you
Suppose people hold equal amounts of currency and demand deposits and suppose banks maintain a 5% reserve ratio, what is the quantity of money?
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