AB 204 STUDY Successful Learning / ab204study.com AB 204 STUDY Successful Learning / ab204study.com | Page 9

Assume the economy is autarky (closed) and it does not have trade
and capital transactions (flows) with foreign countries.
==============================================
AB 204 Unit 7 Assignment Money, Banks and the Federal
Reserve System
FOR MORE CLASSES VISIT
www.ab204study.com
1. This section deals with increase money supply given two scenarios
(see “a” and “b” below).
In Westlandia, the public holds 50% of money one (M1) in the form
of currency, and the required reserve ratio is 20%.
2. Explain how each of the following changes quantity of money
(money supply) in the economy.
3. Assume that in a country the total holdings of banks were as
follows:
==============================================
AB 204 Unit 8 Assignment
FOR MORE CLASSES VISIT