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In the nation of Wiknam, people hold $1,000 of currency and $4,000 of demand deposits in the only bank, Wikbank. The reserve-deposit ratio is 0.25.

In the nation of Wiknam, people hold $1,000 of currency and $4,000 of demand deposits in the only bank, Wikbank. The reserve-deposit ratio is 0.25.

Using the equations we covered earlier, calculate the following:

  1. The money supply (M).
  2. The monetary base (B).
  3. The money multiplier (m).

M = m x B

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