If M = the quantity of money, m the money multiplier, MB the Monetary Base, C = Currency, D = Deposits, R = Reserves, RR equals required reserves, rD = the required reserve rate and ER = Excess reserves, then RR/D would equal:
A. The amount in Required Reserves.
B. The required reserve rate.
C. The amount in Excess Reserves.
D. The monetary base.
Answer:B
If M = the quantity of money, m the money multiplier, MB the Monetary Base, C = Currency, D = Deposits, R = Reserves, RR equals required reserves, rD = the required reserve rate and ER = Excess reserves, then RR/D would equal:
A. The amount in Required Reserves. B. The required reserve rate. C. The amount in Excess Reserves. D. The monetary base.