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16. Assume base money MD is ?5, currency CUR is 50, and money M is EDD. Complete the table showing the value of each quantity and the formula on which you relied. Base Money MCI Currency CUR Money M Deposits DEP Reserves RES Currency Drain Ratio c Reserve Ratio r Money Multiplier u 1?. Initially, base money MCI is 250, the currency drain ratio c is 0.2, and the reserve ratio r is constant at 0.1. Bank run fears then lead the currency drain ratio c to rise to I115. The central bank wishes to head off any reduction in the money supply M, so as not to harm small firms which rely on bank financing. What new value of base money MD must the central bank choose? 18. Assume the ofcial cash rate is 1% and the nominal interest rate on retail deposits is 3%. Assuming equilibrium behavior, what do you deduce must be a bank's annual cost of attracting and retaining retail deposits [expressed in percentage terms}? 19. Assume the following costs of a fixed market basket in Australia and the US. a. Cost of US basket in AUDI: 120. b. Cost of U3 basket in USD: 90. c. Cost of Australian basket in AUD: 160. Using these data, com pute the following quantities: d. Nominal exchange rate EAUDUSD [USD per AUSl}: . e. Cost of Australian basket in USD: f. PPP exchange rate em : g. Real exchange rate 6'\