The past 5 years balance sheet of NAB 

Assets:

	Reserves	Securities	Loans
2022	56.46B	146.1B	822.3B
2021	50.83B	122.63B	728.7B
2020	64.39B	144.34B	634.84B
2019	55.46B	149.27B	619.88B
2018	50.19B	134.83B	598.55B

 

Liabilities:

	Borrowings	Capital	Demand Deposits (CD)	Savings and time deposits (S & T)	Other Liabilities
2022	290.64B	59.03B	410.64B	206.07B	86.66B
2021	276.41B	62.78B	391.76B	156.01B	36.14B
2020	257.02B	61.29B	333.48B	170.31B	40.62B
2019	273.68B	55.6B	264.23B	201.25B	48.85B
2018	264.94B	52.71B	245.81B	207.13B	33.73B

 

[1] Note that (in the format we are using in class) the asset side has Reserves, Securities, Loans, and Other Assets, whereas the liabilities side has Demand Deposits (CD), Savings and Time Deposits (S & T), Borrowing (B), and Other Liabilities (liabilities that cannot be classified anywhere else are lumped together here). The Net Worth or Equity is labelled as Capital in that format.

[2] Once, you have converted the balance sheets in the desired format, you may notice that total assets may differ somewhat from total liabilities plus capital. This is due to the fact the numbers in the MarketWatch data are not perfectly accurate, but this inaccuracy does not matter for the analysis here. 

 

Q2 By using the correctly formatted balance sheets prepared in Q1, for each of the 5 years, calculate the value of the money multiplier, m (use c=0.3). Assuming that NAB's multiplier is representative of the aggregate Australian banking sector, comment on the significance of this multiplier for the Australian economy. What happens in the banking sector (once it reaches equilibrium) if RBA decides to inject $100 M in reserves? Show via a T-Account entry.

 

FIX THIS - for me i believe all of this question is wrong please help. Please ensure you do every part of this question for Q2 :)
 

The Money Multiplier, m:

 

Year 2022:
Year 2021:
Year 2020:
Year 2019:
Year 2018:

Answer rating: 100% (QA)

To calculate the money multiplier m for each year well use the formula m 1 c r where m Money Multiplier c Currency Reserve Ratio r Required Reserve Ra... View the full answer