Z just received k300,000 from his daughter who stays in Germany. He deposits the entire k300,000 in the bank.given that the reserve ratio is 15%(A)calculate the deposit and credit multiplier?(B) if...

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Z just received k300,000 from his daughter who stays in Germany. He deposits the entire k300,000 in the bank.given that the reserve ratio is 15%(A)calculate the deposit and credit multiplier?(B) if the bank and other commercial banks in the country are profit maximizing banks banks which do not keep excess reserves, by how much will credit and deposits grow in the economy as a result of z's deposit of k300,000? (6 mrks)(C) what factors will limit the credit creation process in this economy?(D) describe how the bank of Zambia undertakes expansionary monetary policy using discount rate policy(E) of the monetary policy tools stated in (d),which is the bank of Zambia 's preffered policy tool?explain why?

Answered Same DayDec 26, 2021

Answer To: Z just received k300,000 from his daughter who stays in Germany. He deposits the entire k300,000 in...

Robert answered on Dec 26 2021
124 Votes
Given: Deposited amount = k300,000
(A) Bank Reserve Ratio = 15% =0.15
??????? ???????? =
1
??
?????? ??????? ?????

With the help of this formula, we can calculate Deposit multiplier
??????? ???????? =
1
0.15
= 6.6667
So we have deposit multiplier as 6.6667 or 666.67%.
Credit multiplier is called money multiplier as well
Formula for money multiplier
????? ?????????? =
1
???

Where RRR- Required...
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