Money creation in modern banking systems

1) Money creation in modern banking systems:
a) Describe the process of the creation of money in the banking system. (2)
b) Then, work through the following numerical example: Starting at zero deposits, 200$ are newly deposited at Bank A, the only bank in country A. The reserve requirement ratio is 20%. Give the first three iterations in the process that multiplies money in the banking system. (2.5)
c) If the process plays out all the way, what is the eventual amount of money in deposits at bank A? (0.5)
2) What does the aggregate supply (AS) curve represent? Why do we distinguish long-run and short-run when working in this framework? (2)
3) Discuss the following statement, from an AS/AD model perspective (aggregate supply / aggregate demand): The influence of changes of aggregate demand on output level and price level depends on the economic environment. (What are ways to represent different economic environments in the model; through the slope of the curves in the model?) (3)
4) What do shifts of the short-run aggregate supply curve represent? Name two possible causes for such shifts? (2)
5) Describe the difference between cost-push inflation and demand-pull inflation. (3)
6) What does the concept of crowding-out describe in macroeconomic models? (2)
7) Explain the effects of expansive fiscal policy in an AS/AD model framework. Use IS-curve and Fed rule in your explanation. (4)
8) Even if the output level in the long run is given, fiscal and monetary policy have effects on output. Which, and how/why? (3)
9) Under which circumstances is a Central Bank in a binding situation? What does this mean for the policy options available for stabilizing or strengthening economic activity? (3)
10) Briefly describe the different focuses of fiscal policy measures, and monetary policy measures, respectively. (3)

Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
The price is based on these factors:
Academic level
Number of pages
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more
Open chat
You can contact our live agent via WhatsApp! Via + 1 3234125597

Feel free to ask questions, clarifications, or discounts available when placing an order.

Order your essay today and save 25% with the discount code HAPPY