1. 2.

a. The money supply is $6,000,000, currency held by the nonbank public is $2,000,000, and the reserve–deposit ratio is 0.25. Find deposits, bank reserves, the monetary base, and the money multiplier.

b. In a different economy, vault cash is $1,000,000, deposits by depository institutions at the central bank are

$4,000,000, the monetary base is $10,000,000, and bank deposits are $20,000,000. Find bank reserves, the money supply, and the money multiplier.