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Tutorial section number: _ol ECONOMICS 1022b-002/004 Department of Economics Western University Jeannie Shearer TUTORIAL QUIZ 2A /Ct Depasa March 8,...
how to do the c and d
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1111111111111111111111111Tutorial section number: _olECONOMICS 1022b-002/004Department of EconomicsWestern UniversityJeannie ShearerTUTORIAL QUIZ 2A/Ct DepasaMarch 8, 20191.In an economy, the quantity of money is E285 billion and the monetary base is E35 billion.RtcHouseholds and firms hold E23 billion in bank notes and coins. M = C+ Da.Calculate bank deposits. (1 mark)MB=R+C2836 - 23b = 262b.b. Calculate bank reserves (1 mark)35b- 23b = 1 2biumC.Now suppose that the banks have no excess reserves and the quantity of money increases byE4.25 billion when the central bank increases bank reserves. What is the money multiplier? (2marks)mm =MCtDMB 2+C1289 .2535- 8 .2bd. Calculate the incease in bank reserves made by the central bank. (2 marks)Xmm?