APMacro: Multiple Expansion, Reserves and Mulltiplier


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Students, you will learn how banks expand the money supply by lending out excess reserves. Because this process is so important when analyzing monetary policy, we have lots of practice in calculating reserve requirements, required reserves, excess reserves, demand deposits, and money multipliers. It is dog work, but practice should help you see the multiple expansion of reserve requirements at work.


Homework:
1) Multiple Expansion of Demand Deposits worksheet
2) Reserve Requirements and the Multiplier worksheet

Arrows-02-june

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