Economics (7th Edition) (What's New in Economics)
7th Edition
ISBN: 9780134738321
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Question
Chapter 25, Problem 25.4RDE
Subpart (a):
To determine
M1 velocity and M2 velocity.
Subpart (b):
To determine
M1 velocity and M2 velocity.
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Suppose that a country computes its monetary aggregates in the same way as the Federal Reserve. The
relevant table on the central bank website reports the following values.
a.
b.
C.
Currency
Treasury securities
Savings deposits
Other checkable deposits
Large time deposits
Bank reserves
Retail money market mutual funds
Demand deposits
Small time deposits
$751
$1,041
$642
$241
$802
$167
$105
$524
$361
What is the value of M1? (Give $ value.)
What is the value of the monetary base? (Give $ value.)
Suppose the interest rate on government bonds is 2.7%. What is the government's seigniorage
revenue? (Give a $ value; ignore the costs of printing the currency, etc., and assume the central
bank does not pay interest on reserves.)
Answer questions 1-4 about Nigeria's macroeconomy (Nigeria's currency):
Currency in Circulation (October 2020)
40.5 billion nigerian currency
Reserves (October 2020)
34.2 billion nigerian currency
M1 (October 2020)
2,465.9 billion nigerian currency
M2 (October 2020)
2,638.8 billion nigerian currency
Calculate the size of the monetary base in October 2020. one decimal place.
Calculate the size of demand (checking) deposits in October 2020. Round your answer to one decimal place.
Calculate the size of savings deposits in October 2020. Round your answer to one decimal place.
Suppose that to finance its credit policy, the Fed pays an annual interest rate of 0.25 percent on bank reserves. During the course of the current year, banks hold $1.3 trillion in reserves.
What is the total amount of interest the Fed pays banks during the year?
The Fed pays banks S billion of interest during the year. (Enter your response rounded to two decimal places.)
Chapter 25 Solutions
Economics (7th Edition) (What's New in Economics)
Ch. 25 - Prob. 25.1.1RQCh. 25 - Prob. 25.1.2RQCh. 25 - Prob. 25.1.3RQCh. 25 - Prob. 25.1.4RQCh. 25 - Prob. 25.1.5PACh. 25 - Prob. 25.1.6PACh. 25 - Prob. 25.1.7PACh. 25 - Prob. 25.1.8PACh. 25 - Prob. 25.1.9PACh. 25 - Prob. 25.2.1RQ
Ch. 25 - Prob. 25.2.2RQCh. 25 - Prob. 25.2.3PACh. 25 - Prob. 25.2.4PACh. 25 - Prob. 25.2.5PACh. 25 - Prob. 25.2.6PACh. 25 - Prob. 25.2.7PACh. 25 - Prob. 25.2.8PACh. 25 - Prob. 25.2.9PACh. 25 - Prob. 25.2.10PACh. 25 - Prob. 25.3.1RQCh. 25 - Prob. 25.3.2RQCh. 25 - Prob. 25.3.3RQCh. 25 - Prob. 25.3.4RQCh. 25 - Prob. 25.3.5PACh. 25 - Prob. 25.3.6PACh. 25 - Prob. 25.3.7PACh. 25 - Prob. 25.3.8PACh. 25 - Prob. 25.3.11PACh. 25 - Prob. 25.3.12PACh. 25 - Prob. 25.4.1RQCh. 25 - Prob. 25.4.2RQCh. 25 - Prob. 25.4.3RQCh. 25 - Prob. 25.4.4RQCh. 25 - Prob. 25.4.5PACh. 25 - Prob. 25.4.6PACh. 25 - Prob. 25.4.7PACh. 25 - Prob. 25.4.8PACh. 25 - Prob. 25.4.9PACh. 25 - Prob. 25.4.10PACh. 25 - Prob. 25.4.11PACh. 25 - Prob. 25.5.1RQCh. 25 - Prob. 25.5.2RQCh. 25 - Prob. 25.5.3RQCh. 25 - Prob. 25.5.4PACh. 25 - Prob. 25.5.5PACh. 25 - Prob. 25.5.6PACh. 25 - Prob. 25.5.7PACh. 25 - Prob. 25.5.8PACh. 25 - Prob. 25.5.9PACh. 25 - Prob. 25.5.10PACh. 25 - Prob. 25.1RDECh. 25 - Prob. 25.2RDECh. 25 - Prob. 25.3RDECh. 25 - Prob. 25.4RDECh. 25 - Prob. 25.5RDECh. 25 - Prob. 25.6RDE
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