Answer to Question #113246 in Microeconomics for pak defence khan

Question #113246
We know that in a closed economy with our modern two tier banking system 5 % of the money stock is cash amounting to 199 $. The ratio of outstanding loans of non bank agents at commercial banks and the outstanding loans of commercial banks at the central bank is 5 to 1. We omit banks’ retained earnings. How much $ is the reserve in this economy?
1
Expert's answer
2020-05-03T17:07:49-0400

"5 percent =199"

"100?"

"100\u00d7199\\over5"

"=38980"


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