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Q. What do you mean by multiplier effect?
Loans and deposits in banks give rise to a significant multiplier effect. We use a simple instance to explain this effect. Consider the bank K-bank with total deposits of 10,000 (millions or whatever). K-bank is aiming for a reserve ratio of 10% of deposits. At the instance it has lent 9,000 and has 1,000 in reserve - exactly meeting their desired reserve ratio.
I am trying to figure out how to calculate the eqilibrium level of income and the multiplier
The World Trade Organization is a successor organization to the A.United Nations. B.World Bank. C.International Court of Justice. D. GATT.
What is the relationship between deposit multipier,Credit Multiplier and Deposit multiplier?
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