The economy of Nocoin: monetary base is 45 billion, quantity of money is 330 billion, banks reserve ratio is 5%, currency drain is 10%... now suppose the central bank of nocoin increases bank reserves by 0.5 billion...
1. what happens to the quantity of money?
2. why is the change in quantity of money not equal to the the change in the monetary base?
3. what is the money multiplier?
1. what happens to the quantity of money?
2. why is the change in quantity of money not equal to the the change in the monetary base?
3. what is the money multiplier?