1. Find the reserve ratio and change in money supply if the change in reserves is 500 and money multiplier is 4.

20%; $2000 25%; $2000 4%; $125 4%; $2000

2. Think of the "money supply" (MS) as equal to either M1 or M2.

RR=100% , Change in reserves = 7.3 billion. Find MM and Change in MS.

1; 73 1; 7.3 100;7.3 100;73

3. Money multiplier is an important concept in Macroeconomics. If the reserve ratio is 8% and the change in reserves is $16 million. The money multiplier and change in money supply would be?

12.5; 200 1.28; 20.48 0.08,200 12.5; 20.48

4. The reserve ratio in the US is 20%, and Bank of the West has $10 million in deposits, so they can effectively lend out

$8 million $6 million $50 million $2 million

5 . What is the change in the money supply if the Fed increases bank reserves by $13,200 and the banking system has a reserve ratio of 1/10?

13,200 132,000 1320 1320000

6. The Federal Reserve has instituted a reserve ratio of 12%, what is the money multiplier? Leave your answer in 2 decimal places.

6.00

8.33

12.00

0.12

7. year M2 V

1932 $28.4 billion 2.04

1934 $30.2 billion 2.22

What was the growth of nominal GDP between these two years.

15.72%

13.59%

-13.59%

9.11%

8. year M2 V

1932 $28.4 billion 2.04

1934 $30.2 billion 2.22

What was the growth of velocity between these two years? Leave your answer in 2 decimal places.

-450.66% 8.11% 8.82% 450.66%