Suppose the required reserve ratio is $8\%(\mathrm{.}08),$ the excess reserve ration is $2\%(\mathrm{.}02)$ and the

currency deposit ratio is $30\%(\mathrm{.}30).$ What is the value of the money supply multiplier?

f$.$ Suppose the Fed engages in $$40$ million in open market sale. What impact would this have on the

monetary base? By how much would the money supply M$1$ change?

g$.$ Now suppose the Fed raises the required reserve ration to $10\%(\mathrm{.}10),$ ceteris paribus. Now what is

the value of the money multiplier? By how much would the money supply now change in part f

above?

h$.$ Now assume that department and grocery stores STOPPED accepting credit cards and consumers

had to resort to shopping with cash. How will the money multiplier and money supply be affected