In an economy, the initial deposits are one-sixth of total deposits created. The value of money multiplier will be:
In an economy, the initial deposits are one-sixth of total deposits created. The value of money multiplier will be:
(a) 6
(b) 0.6
(c) 1/6
(d) None of these
Anurag Pathak Changed status to publish January 5, 2024
Ans – (a)
Solution:-
Initial deposits = 1/6 of the total deposits
Total deposits = Money Multiplier
Money Multiplier = Initial Deposits/Total Deposits
Money Multiplier = 1/1/6
Money Multiplier = 6 times
Anurag Pathak Changed status to publish January 5, 2024
