Question: Numerical exercise 1. Suppose there is an initial deposit in a bank is RO 1000 where CRR is 20%. Calculate the credit creation in first

Numerical exercise 1. Suppose there is an initial deposit in a bank is RO 1000 where CRR is 20%. Calculate the credit creation in first four banks and over equilibrium level. BANKS INITIAL DEPOSIT CRR DEPOSIT EXCESS RESERVE A 1000 200 800 B 800 160 640 C 640 128 512 D 512 102.5 409.6 5000 1000 D=4000 1xAD d = -X AD 1

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!

During jury selection at his state court trial for aggravated murder and related offenses, the state used all 6 of their peremptory challenges to strike the only 6 black individuals from the jury....

Numerical exercise 1. Suppose there is an initial deposit in a bank is RO 1000 where CRR is 20%. Calculate the credit creation in first four banks and equilibrium level. over BANKS INITIAL DEPOSIT...

PowerPoint Assignment for BUS 401: Principles of Finance You have been asked by a manager in your organization to put together a training program explaining Net Present Value (NPV) and Future Value...

create a value stream map for the mailroom categories 1-3 (page 6). Start your value stream map woth delivery of the mail to ING. . Additional information: Assume 1000 pieces of mail for your...

Instructions 10% Deduction for Each Day Late Create a current state map for the mailroom operation for categories 1-3 (page 6). Start your value stream map with delivery of the mail to ING. ....

1. When it comes to financial matters, the views of Aristotle can be stated as: a. usury is nature's way of helping each other. b. the fact that money is barren makes it the ideal medium of exchange....

Money creation ch.15-Discussion A Reserve requirements-Any changes to Table 15.1? (textbook) Go to the Fed's Web site and select "Monetary Policy." Click on "Policy Tools," then "Reserve...

IfyouhaveplayedaSimulationcalledProBankerIneedhelpansweringthesequestionsassoonaspossible from the pro bankerassignment attachment..please use spreadsheet and players manual for reference. Need...

ce What would the consolidated balance sheet of the commercial banks look like after the commercial banks fully adjusted (they are fully adjusted when they are maximizing profits again) to their sale...

This is an economic question, helpe solve it. Exercise 4.6 Suppose GDP is $2,000, consumption expenditure is $1,700, government expenditure is $50, and net exports are $40. (a) What is business...

4 Files 3:18 PM Fri May '13 Insert Draw Layout Review View Unit SMacroeconomic Policy Name: HR: FISCAL POLICY Use the space below to take notes during class. Disposable Income: How does a change in...

4 Apple uses premium pricing for their products and prices are rarely discounted. Does this suggest that Apple has one of the following pricing objectives? a) building a loyal user base b)...

An equimolar mixture of H2 and D2 effuses through an orifice (small hole) at a certain temperature. Calculate the composition (in mole fractions) of the gas that pass through the orifice. The molar...

Neither the Baumol nor the Miller - Orr model considers which one of these factors? Firms have the option of borrowing short - term funds. Cash inflows may occur on a daliy basis. Firms may need to...

On January 1, Pete Rowe bought a ski chalet for $48,500. Pete is renting the chalet for $50 per night. He estimates he can rent the chalet for 180 nights. Petes mortgage for principal and interest is...

Develop skills for building positive relationships.

Describe techniques for resolving conflicts.

Give feedback effectively and receive it appropriately.