Wednesday, August 3, 2011

Economics 450 homework?

If the ratio of currency to transaction deposits is 1, the ratio of nontransaction deposits to transaction deposits is 6, the ratio of retail money-market funds to transactions deposits is 2, the ratio of required reserves to transactions deposits is 0.07, the ratio of excess reserves to transactions deposits is 0.02, and the ratio of required clearing balances to transactions deposits is 0.03. Then the M1 multiplier equals Fill in the Blank 12 and the M2 multiplier equals Fill in the Blank 13 (two decimal places).

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