Lending capacity of cash, Microeconomics

Assume the banking system contains:

Total Reserves                         $ 80 billion

Transactions Deposited          $800 billion

Cash held by public                 $100 billion

Reserve Requirement                     0.10

(a)    Are banks fully utilizing their lending capacity?

(b)   What would happen to the money supply initially if the public deposited another $50 billion of cash in transactions accounts?

Posted Date: 3/16/2013 6:23:17 AM | Location : United States







Related Discussions:- Lending capacity of cash, Assignment Help, Ask Question on Lending capacity of cash, Get Answer, Expert's Help, Lending capacity of cash Discussions

Write discussion on Lending capacity of cash
Your posts are moderated
Related Questions

Comparison with Our Targets : A proper objective assessment of our performance can be carried out only when we juxtapose our current achievements with: (i) planned or targeted

The law of supply is that producers will supply more the higher the price of the commodity.  The supply curve is an upward sloping function showing a direct relationship among pric

the sources of market failure

What is the concept of the development? The concept of the development: Development is a complicated multi-dimensional concept to do along with enhancements in the human


Suppose the price elasticity of demand for extra dark chocolate truffles is -6. Hold other things constant , if price for Extra Dark Chocolate truffles is decrease by 3%, what wil

define cost its types with curves

Average Product (AP) of a Factor: The productivity of a factor is often seen in terms of its average contribution. Although not very important in the theoretical discussions,

critically analysis firm theory of profit maximization?