Assume that Company XYZ directly deposits its annual profit at one of the commercial
banks in the country as a checkable deposit and that the reserve ratio is 10%. Trace out the effects of a $60 million profit of XYZ on the value of checkable bank deposits. What is the size of the money multiplier?

Please provide a complete detailed answer for this question

Answers

Answer 1

Answer:

In a fractional reserve system, money is created when entities deposit money in bank accounts because the bank will then be able to loan out this money to others.

The reserve ratio is the percentage of the deposit that the bank is required by the Central bank of a country to keep in reserve and not loan out. This percentage is 10% in this scenario.

Money creation will work like this. Company XYZ will deposit the $60 million profit into the bank. The bank will keep 10% of this in reserve which is $6 million and loan out $54 million. The bank still owes XYZ $60 million but has now created an additional $54 million out of it.

This $54 million will be loan to someone else who will deposit it an a bank which will keep 10% and loan out the rest. This process goes on in theory until it reaches a certain amount.

That amount can be calculated by multiplying the initial deposit by the money multiplier.

Money Multiplier = 1 / Reserve ratio

= 1/ 10%

= 10

This means that depositing $60 million will lead to money being created to the tune of;

= 60 * 10

= $600 million


Related Questions

The Zhou Dynasty began after

Answers

Answer:

Around 1046 BC, Wen's son Wu and his ally Jiang Ziya led an army of 45,000 men and 300 chariots across the Yellow River and defeated King Zhou of Shang at the Battle of Muye, marking the beginning of the Zhou dynasty

Explanation:

Indicate the response that best describes what you would do in the situation. You have several jobs you need to finish before the end of the day. You see that some other group members have free time on their hands because they finished their jobs earlier than they expected. What should you do? a. Continue with your own work and try your best to get it all done. b. Ask your supervisor to get you some help. c. Tell each free group member to take one of your jobs. d. Ask one of your fellow group members to take some of your work.

Answers

Answer:

d. Ask one of your fellow group members to take some of your work.

Explanation:

If fellow co-workers are enjoying a break because they have finished their tasks quickly, one should ask one of tem to help with some of the work. This is a common situation in the workplace in which co-workers are expected to cooperate with each other, because cooperation leads to better results for the company as a whole.

Answer:

A

Explanation:

Becasue your going to start talking to the about your life and there tell everything to the whole company wht you told them.

Which of the following best describes the climate in the Great Plains?A) Mild year round with dry summers and wet wintersB) Dry with extreme temperature differences between the seasonsC) Dry, frigid winters with periods of high rainfall in the summer.D) Mild winters with dry, hot summers.

Answers

Answer:

D) Mild winters with dry, hot summers.

Explanation:

Great Plains: The term "Great plains" are said to occupy specific areas on earth and are mainly located in "North America" and therefore it includes 10 different  states, they are South Dakota, Kansas, New Mexico, Montana, North Dakota, Oklahoma, Wyoming, Colorado, Texas, and Nebraska.

Great plains consists of the flat landscape, fertile prairie grasslands, and hot summers that is responsible for making it an ideal place for large-scale ranching and farming.

What will help Africa develop their natural recources?​

Answers

Answer:More trades and support

Explanation: if there is no support they'll starve and pass away

Trading form other places

In response to criticisms that the King of Mordor has failed to gain the consent of his people, the King claims that he does in fact represent the consent of the people because without their King, society would crumble into chaos.
Which statement BEST represents a rebuttal that Rousseau would use to counter the King’s argument?
A.
Absolute chaos is preferable to the absolute power of the King.
B.
The King of Mordor should establish a system of checks and balances.
C.
If the King of Mordor were to represent the will of his people, then he would at least provide the public services demanded by his people.
D.
It is impossible for the King of Mordor to have the consent of the people because the monarchy is not a freely formed government in which the people have a say in how it operates.

Answers

Answer:

it is D hope this helps I have had this question before

Answer:

 D.

It is impossible for the King of Mordor to have the consent of the people because the monarchy is not a freely formed government in which the people have a say in how it operates.

Explanation:

i took the practice may i please get brainliest

The Articles of Confederation failed due to their weaknesses. Choose the weaknesses from the list below.

1. Congress could not regulate currency
2. Congress could not declare war
3. There was only one branch in the national government
4. Congress could not run a post office
5. Congress could not enforce laws
6. Congress could not collect taxes from states​

Answers

I’m going to say 6 2 and 1 ? How many do u have to choose ? Ik it’s 3 because there’s more then one branch in the national government which is judicial. Executive and legislative

(xiii)
What is meant by co-operative bank?​

Answers

Answer:

A bank that holds deposits, makes loans and provides other financial services to cooperatives and member-owned organizations known as co-operative bank .

Which of the following events is an example of forming a more perfect union today?

Answers

in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America.

Scenes involving nudity can be filmed anywhere on campus.
a) true
b) false

Answers

The answer is B false.

Which different groups invaded the Roman Empire?

Answers

Answer:

Many of the groups that attacked and invaded the Roman Empire were Germanic tribes from Northern Europe. Goths - One of the most powerful and organized groups of barbarians were the Goths. The Goths were divided into two major branches: the Visigoths and the Ostrogoths.

Explanation:

Explanation:

Germanic tribes from Northern Europe's goths and the visigoths and the ostrogoths

Consider a time you felt competent in learning about another culture or co-culture. What was the situation? How did you gain knowledge about the culture? Did this knowledge cause you to change your behavior or thoughts? Why or why not?

Answers

Answer: at first i had a cultural shock, but I decided to adapt to the new culture by understanding the history and reason to why they did what they do. Then I had to view the culture bases on their own perspectives - cultural relativism

Explanation:

The _________________________________ the first written constitution in the Colonies, extended voting rights, created an election cycle, and set term limits. Question 8 options: Mayflower Compact Virginia House of Burgesses Fundamental Orders of Connecticut Magna Carta

Answers

Answer: Fundamental Orders of Connecticut

Explanation:

The Fundamental Orders of Connecticut is considered to be the first written constitution in the Colonies. Connecticut was established by people who did not like the strict policies that were adopted by the Puritans of Massachusetts and so sought to have a colony that gave larger freedoms to is inhabitants.

Two years after the colony of Connecticut was established in 1636, free men from 3 towns of the colony signed the orders which gave more voting rights to the people than in Massachusetts, created an election cycle, allowed people to be able to run for office, and set term limits.

According to the charter , the Georgia colony was founded.

Answers

Answer:

The Georgia colony was founded in 1733

Explanation:

Answer:

A- to provide a place for poor British citizens to live.

Explanation:

the charter of 1732  

well the charter  basically says it in the last sentence

the charter says  " it would be highly beneficial that a regular colony of the poor people  will be settled and established in the southern territories of Carolina  - the charter of georgia, 1732  . it  is saying that  the poor British citizens will be provided with a place to live .

if you can not find it it says " the British citizens that are poor will be settled and established and will also  be provided a place to live located in the southern territories of Carolina.

i hope this helps .

Describe the response of the pupil when light was shone on it.

Answers

Answer:

Consensual

Explanation:

Normally light that is directed in one eye produces pupil constriction in both eyes. The direct response is the change in pupil size in the eye to which the light is directed (e.g., if the light is shone in the right eye, the right pupil constricts).     Welcome :)

What do wind and moving water have in common?
A They both have chemical energy.
B They both have mechanical energy.
C They both have light energy.
D They both have nuclear energy.

Answers

Answer:

b

Explanation:

B because both wind and water move.

Psychoanalytic theories stress what in development?

Answers

Answer: BECAUSE

Explanation:Psychoanalytic theories stress the continuity of individual differences across development. The child can become fixated on those needs, continually attempting to satisfy them. Substitutes like nail-biting, overeating, smoking. Biologically based, instinctual drives that energize behavior, thoughts, and feelings

5. Describe at least three investments you want to make with your income. Explain whether
each one is an equity investment or a debt investment, and explain why you chose these
particular types of investments. (1-6 sentences. 3.0 points)

Answers

Answer:

I would like to buy a car with the income I would make, it would be a equity investment. I chose this item because it would help me get to work and places on my owns. I would also like to buy or rent a house with my income, this would also be a equity investment, it would give me a place to live to a long-period of time. I would like to invest in a strong company would wants to help the good in the world, this is a debt investment, it would give a strong face to the world.

- - - - - - -

if this helps please mark brainliest <3

The three investments you want to make with your income are

Buying a carbuying a HomeInvesting in a reputed organizationWhat is the investment?

A transaction made with the intention of earning money or growing in value is known as an investment. When someone buys something as an investment, they don't intend to utilize it right now to make money instead, they plan to use it later to achieve that goal.

Debt investment refers to an investment made in a company or project by the purchase of a significant value of debt, with the intention of repaying principal and interest. So investment in any organization is an example of this.

An investment of money in the stock market securities of a firm is known as an equity investment. Here buying a car or Home is considered an example.

Learn more about Investment, here:

https://brainly.com/question/17252319

#SPJ5

Some fossils provide evidence to suggest that Earth's climate has changed over time. What information can scientists obtain from these fossils? temperatures, number of species that existed, movement of continents, or cause of mass extinctions

Answers

Answer:

temperatures.

Explanation:

Some fossils indicate that the Earth's climate has altered over time. Temperatures and information may be obtained from these fossils by scientists. Thus, option (a) is correct.

What is Earth's?

The term Earth refers to the planet of the solar system. The Earth is the only planet where life is possible for living things' in reason of gravitational force. The Earth's main elements are life, air, water, and land. The Earth's planet radius is 3,959 miles. The Earth is only for oxygen.

According to the physical geography is Earth's climate and the location was the similar. The mountains and the season was the rainy and the dry. The temprecher was the cooler.  The changes were the primary causes of temperature, climate, and weather changes. Wind, other forces, density changes, or temperature changes can all cause water to move in a body of water in the Earth's.

As a result, some fossils indicate that the Earth's climate has altered over time. Temperatures and information may be obtained from these fossils by scientists. Therefore, option (a) is correct.

Learn more about on Earth's, here;

https://brainly.com/question/12041467

#SPJ6

"Research indicates that the closer people live to an airport where planes fly after 11 PM, the greater variation in average hours of sleep they report getting per night." Based on this statement, what can we conclude about the relationship between noise pollution and sleep consistency?

Answers

Answer:

Negative relationship between variables

Explanation:

Negative correlation/coefficient in statistical regression analysis indicates a negative relationship between variables whereby one variable increases as the other decreases. This is shown graphically on a scatter plot diagram. A perfect negative relationship has -1 correlation while a perfect positive relationship has a +1 correlation. Zero correlation means no relationship between variables at all

Based on this statement we can conclude that there is a negative  relationship that exists between average slleep hours and the proximity to airports.

From this question we can see that the average hours of sleep of people is affected in variable ways due to the fact that they live around the airports.

This means that the  noise affects the sleep pattern of the people in these areas

Read more on noise pollution here:

https://brainly.com/question/2278957

Zionist pressure on the British government during World War I resulted in religious and ethnic tensions in
Iran.
Syria.
Palestine,
Saudi Arabia

Answers

Answer:

saudi arabia

Explanation:

Zionist pressure on the British government during World War I resulted in religious and ethnic tensions in Palestine.

Zionism is simply regarded wel thought-out movement which is said to be founded by Theodor Herzl in 1897. Its history began earlier and had a link to Judaism and Jewish history.

The Hovevei Zion, were know to be involved in creation of 20 new Jewish cities in Palestine that took place in 1870 to 1897.

Conclusively, The movement aim to re-establish a Jewish national home and cultural centre in Palestine .

Learn more from

https://brainly.com/question/7438060

From 1735 to 1760, the value of exports from Georgia to England increased by about three thousand pounds sterling. six thousand pounds sterling. nine thousand pounds sterling. twelve thousand pounds sterling.

Answers

Answer:nine thousand pounds sterling

Explanation: I took the quiz and got it correct <3

Answer:

its 800,000 pounds of sterling a year.

Explanation:

not 9000 or wtv the person above me said. i put in 9000 and it was wrong and it told me it was 800,000 sooo... there ya go :))

and the next questions answer is b, he is worshiped like a god.

(got that one right too)

Which state was a home to "Exodusters"?

Answers

Answer:

The exodusters settled in the states of Colorado, Kansas, and Oklahoma.

Explanation:

Who was the king of Spain during the Mexican revolution?
a.
King Agustin
b.
King Hidalgo
c.
King Antonio
d.
King Ferdinand

Answers

Answer:

King ferdinand

Explanation:

Answer:

d

Explanation:

What does the black box represent in the lottery?

Life

Death

Family

Tradition

Answers

Answer:

The answer would be Tradition.

The shabby black box represents both the tradition of the lottery and the illogic of the villagers' loyalty to it. The black box is nearly falling apart, hardly even black anymore after years of use and storage, but the villagers are unwilling to replace it.

Who conducts the lottery

Mr.Graves

Tessie Hutchinson

Mr.Hutchinson

Mr.Summers

Answers

Answer:

Mr. Summers

Explanation:

What is the difference between groundhog days story and plot?

Answers

Answer:

A cynical TV weatherman finds himself reliving the same day over and over again when he goes on location to the small town of Punxsutawney to film a report about their annual Groundhog Day. His predicament drives him to distraction, until he sees a way of turning the situation to his advantage.

Explanation:

The first step in developing a performance test is:_____.

Answers

Answer:

defining the purpose

Explanation:

Performance based assessments or performance tests are used to assess subject's performance by assigning tasks to them and scoring their performance based on performance level in tasks given. Here test materials are designed to derive a level of performance from students/subjects

In performance based assessments, the first step is to decide what to test or purpose of the test and also the inferences to be drawn from test.

Which statements regarding total body water (TBW)are true?
A) During childhood, TBW slowly decreases in relationship to body weight.
B) Gender has no influence on TBW until old age.
C) Men tend to have greater TBW as a result of their muscle mass.
D) Estrogen plays a role in female TBW.
E) Older adults experience a decrease in TBW as a result of decreased muscle mass

Answers

Answer:

A, C, D, E

Explanation:

In childhood, TBW gradually decreases from 60% to 65% of body weight. During adolescence, the percentage of TBW reaches the adult ratio and gender differences begin to appear. Men eventually have a greater percentage of body water as a function of muscle growth. As a function of estrogen women have more body fat and less muscle and therefore less body water. With increasing age, the percentage of TBW decreases further.Deficiency is due to the ability to reduce fat and reduced muscle mass, as well as the sodium and water balance.

What does mean of G.G Brown in communication?​

Answers

Answer:

the transfer of information from one person to another, whether or not it elicts confidence

Why is it important that a country establishes a form of government

Answers

Search Results
Featured snippet from the web
Governments provide the parameters for everyday behavior for citizens, protect them from outside interference, and often provide for their well-being and happiness. In the last few centuries, some economists and thinkers have advocated government control over some aspects of the economy.
Other Questions
4. The first term of the sequence is -3 and the common ratiois -1. 7. Why is the d-block one energy level behind the s-block? Also, why would the f-block be so far behind? There are 3 juice and 1 water. How many more students like juice than water During the first week of her vacation, Madison practices playing her flute 5.75 hours. In the following week, she spends 4.2 hours practicing the flute. What is the difference in the amount of time she spends practicing the flute during these weeks? Gabriel is signing up for a gym membership with a one-time fee to join and then amonthly fee to remain a member. The the monthly fee is $40 and the one-timejoining fee is $100. Write an equation for C, in terms of t, representing the total costof the gym membership over t months.Answer: C =Submit AnswerIattempt 1 out of 2 pleaseee helppp meee. find the length of segments W x Which American Indian groups lived inland from the Northeast coast in approximately 1500? A. the Powhatan and the Delaware B. the Iroquois and the Algonquin C. the Shawnee and the Pequot D. the Delaware and the Fox The ends of a quadrant of a circle have the coordinates 1, 3 and 3, 1. Then, the centre of circle is :A: 2,2B: 1,1C: 4,4D: 2,6 Find the product of 6/9 and 3/8 . Express your answer in simplest form.A.6/24 B.1/6 C.18/72 D.1/4 Choose either Diary 24 or Diary 33 from The Freedom Writers Diary by Erin Gruwell and the Freedom Writers. Evaluate the text you choose by determining its value according to your standards. Oni was timing her 100 meter sprints. Her first five sprints were 12.568 seconds, 11.426 seconds, 12.324 seconds, 11.981 seconds, and 12.601 seconds. Which two estimation techniques will give the same result for the total number of seconds for all five sprints? How many seconds are there in 3 hours and 40 minutes.a10,800 secondsb 11,000 seconds12,200 secondsd 13,200 seconds Determine the radius of the cone, if the volume of the cone is 125 cm andthe height of the cone is 12 cm. Round your answer to the nearesthundredth. can somebody please help me How many zero arin the product of any whole. number less than 10 and 500 Problem 6-09A a1-a2, b (Part Level Submission) Oriole Co. began operations on July 1. It uses a perpetual inventory system. During July, the company had the following purchases and sales. Purchases Date Units Unit Cost Sales Units July 1 4 $140 July 6 3 July 11 7 $150 July 14 6 July 21 8 $161 July 27 5 Collapse question part (a1) Partially correct answer. Your answer is partially correct. Try again. Calculate the average cost per unit at July 1, 6, 11, 14, 21 tumor markers are? A. hormones B. proteins C. other substances D. all of tbe above may be tumor markers Which statement best describes how Spartan and Athenian education differed? Spartan education taught the arts, while Athenian education emphasized courage. Spartan education centered on reading, while Athenian education focused on athleticism. Spartan education encouraged debate, while Athenian education developed battle skills. Spartan education focused on military training, while Athenian education focused on thinking. Qu representaba la corbata azul que el padre encuentra en el asiento del carro? Plz help