Question

If the reserve ratio is 75 percent, the value of the monetary multiplier is:

Answer 1

The value of the monetary multiplier can be calculated using the formula:

Monetary multiplier = 1 / Reserve ratio

If the reserve ratio is 75%, then the monetary multiplier is:

Monetary multiplier = 1 / 0.75
Monetary multiplier = 1.33

Therefore, the value of the monetary multiplier is 1.33.

Answer 2

Answer: if the reserve ratio is 75 percent, the value of the monetary multiplier is 1.33, meaning that for every dollar increase in reserves, the money supply will expand by $1.33.

Explanation: hope it helps