Money Multiplier Calculator Tool

Money Multiplier Calculator

Money Multiplier Calculator

Money Multiplier Calculator

Component Description
Reserve Ratio The fraction of deposits that a bank must hold as reserves.
Money Multiplier The ratio that measures the maximum amount of money that the banking system generates with each dollar of reserves.
Formula Money Multiplier = 1 / Reserve Ratio
Purpose Used to understand the impact of reserve requirements on the money supply.

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