The required reserve ratio is 20. The bank's required reserve ratio

1. If the bank’s required reserves are $25 million, and deposits-
200 million dollars, then the required reserve ratio is equal to:

a) 8%; b)10%; c) 12.5%; d) 20%; d)25%.

2. The bank's actual reserves are equal to $30 million, total amount current investments
Dov- 100 million dollars, required reserve ratio- 10%. Excessive re
The bank's reserves are:

a) $70 million; b) 30 million dollars; c) 20 million dollars; d) 10 million dollars; e) 3 million dollars.

3. The bank's excess reserves are equal to $5 million, the total amount of current deposits
Dov- 30 million dollars, required reserve ratio- 20%. Actual reserve
you bank are:

a) 5 million dollars; b) 10 million dollars; c) 11 million dollars; d) 20 million dollars; e) 25 million dollars.

4. If the bank’s actual reserves amount to $72 million, and excess
equal to 4% of deposits, then with a required reserve rate of 20% the value
required reserves will be:

a) $57.6 million; b) 60 million dollars; c)69.12 million dollars; d) $70 million; e) 55 million dollars.

5. If the required reserve ratio is 12.5%, and the amount of the obligation
The bank's total reserves are equal to 20 million dollars, then the amount of deposits is equal to:
a) 250 million dollars; b) 200 million dollars; c) 160 million dollars; d) 147.5 million dollars; e) 125 million dollars.

6. The required reserve ratio is 20%, and a bank with no excess
accurate reserves, receives a deposit of 100 thousand dollars from a new client. Now
The bank has excess reserves equal to:

a) 20 thousand dollars; b) 80 thousand dollars; c) 100 thousand dollars; d) 400 thousand dollars; e) 500 thousand dollars.

7. If the required reserve ratio is 20%, and the amount of the obligation
The bank's total reserves are equal to $30 million, then the maximum loan amount
The amount that this bank can issue is equal to:

a) 0; b) 300 million dollars; c) 200 million dollars; d) 150 million dollars; e) 120 million dollars.

8. If the required reserve ratio is 20%, then the availability of banks
Russian system of excess reserves in the amount of 100 dollars. may lead to poppy
the maximum increase in the money supply by:

a) 20 dollars; b) 100 dollars; c) 300 dollars; d) 500 dollars; e) 750 dollars.

9. If the required reserve ratio is 25%, then the bank mule
the typplicator is equal to:

a) 0.25; b) 2.5; at 4; d) 5; e)25.

10. If the required reserve ratio is 10% and a bank that does not have
excess reserves, receives a deposit of $100. from a new client, then
its excess reserves will be equal to:

a) 0; b) 10 dollars; c) 90 dollars; d) 100 dollars; d) 1000 dollars.

11. If the required reserves of the bank are 40 thousand dollars, and deposits

- 200 thousand dollars, then the bank multiplier is equal to: a) 2; 6) 4; at 5; d) 8; e)20.

12. If the bank multiplier is 8, then the required reserve ratio
VOV is:

a) 8%; b)10%; c) 12.5%; d) 20%; e) it is impossible to say definitely.

13. If the bank multiplier is 4, and the amount of bank deposits
is 100 million dollars, then the required reserves are equal to:

a) 20 million dollars; b) 25 million dollars; c) 40 million dollars; d) 50 million dollars; e)100 million dollars.

14. If the bank multiplier is 8, and the amount of mandatory repayments
The bank's reserves are equal to 30 million dollars, then the amount of deposits is:

a) 80 million dollars; b) 120 million dollars; c) 240 million dollars; d) 300 million dollars; e) 375 million dollars.

15. If the bank, having fully used its credit capabilities, issued
loan 24 thousand dollars, which led to an increase in the money supply by 120
thousand dollars, then the amount of deposits of this bank is equal to:

a) 12 thousand dollars; b) 24 thousand dollars; c) 25 thousand dollars; d) 30 thousand dollars; e) 48 thousand dollars.

16. If a person withdraws his deposit for 1 thousand dollars. from bank A and deposit
puts this amount on deposit in bank B, then with a required reserve ratio of 10%
As a result of these actions, the total amount of demand deposits
may change to:

a) 1 thousand dollars; b) 9 thousand dollars; c) 10 thousand dollars; d)0; e) it is impossible to say definitely.

17. If a commercial bank has a deposit in the amount of 10 thousand dollars. and holes
MA of required reserves is 20%, then this deposit can increase
the amount of loans provided by this bank for:

a) indeterminate size; b) 8 thousand dollars; c) 10 thousand dollars; d) 20 thousand dollars; e) 40 thousand dollars.

18. A depositor deposits $4,000 into a commercial bank. in cash. Commercial
The bank increases its required reserves by $800. and issues a loan for
the amount of 2000 dollars. As a result of these operations, the money supply:

a)↓by 4000 dollars; b) for 2000 dollars; c)↓by 2000 dollars; d) for 8000 dollars; d) for 10,000 dollars.

19. Commercial Bank sold government bonds to his clients for
1 million dollars and added the resulting amount in full to his reserves. Predlo
money flow therefore:

a) decreased by 1 million dollars;

b) has not changed;

c) increased by 1 million dollars;

d) increased by $1 million, multiplied by the bank multiplier;

e) it is impossible to say definitely.

20. A commercial bank sold government bonds to the central bank.
ku for 500 thousand dollars. The amount paid by the central bank, commercially
The bank issued a full loan. The required reserve ratio is 12.5%.
The money supply is therefore:

a)↓by 500 thousand dollars; b) has not changed;

c) for 500 thousand dollars; d) by 4000 thousand dollars; e) by 3500 thousand dollars.

21. If the norm of required reserves is 10%, and the amount of the obligation
The bank's total reserves are equal to $50 million, then the maximum loan amount
the amount that the entire banking system can issue is equal to:

a) 4000 million dollars; b) 4500 million dollars; c) 5000 million dollars; d) 5500 million dollars.

22. If in a commercial bank the amount of deposits is 20 thousand and
required reserve ratio- 25%, then the entire money supply increases
banking system will be:

a) 20 thousand dollars; b) 25 thousand dollars; c) 40 thousand dollars; d) 60 thousand dollars; e) 80 thousand dollars.

23. If, as a result of a commercial bank issuing a loan in the amount of 40
thousand dollars the money supply increased by 200 thousand dollars, then the total amount
deposits in the entire banking system is:

a) 250 thousand dollars; b) 290 thousand dollars; c) 300 thousand dollars; d) 312.5 thousand dollars; e)400 thousand dollars.

24. If commercial bank deposits amount to $60 billion, the banks will
fully use their credit capabilities and banking multiplier
kator is 3, then the money supply will be equal to:

a) 20 billion dollars; b)60 billion dollars; c)63 billion dollars; d) 120 billion dollars; e) 180 billion dollars.

25. If the required reserve ratio is 30% and the banking system
Ma has excess reserves in the amount of $15 million, then the banking system
can increase the money supply to the maximum extent by:

a) 0; b) 10.5 million dollars; c) 15 million dollars; d) 35 million dollars; e) 50 million dollars.

26. In accordance with the following bank balance:

Deposits: 1000 thousand dollars.

Loans 850 thousand dollars. Maximum value a new loan that this bank can provide with a required reserve ratio of 10% will be:

a) 0; b) 50 thousand dollars; c) 150 thousand dollars; d) 500 thousand dollars; e) 1000 thousand dollars.

27. If the total amount of current deposits in a bank is $200 million, its actual reserves are equal to $36 million, and the required reserve ratio- 12.5%, then the amount of loans that, under these conditions, the bank and the banking system as a whole can additionally issue are respectively: a) 12.5 and 25 million dollars; b) 3.6 and 164 million dollars; c) 25 and 36 million dollars; d) 11 and 88 million dollars.

Additional tasks

1. Deposits of commercial banks amount to 3000 million dollars. Oba value
essential reserves - 600 million dollars. If the central bank reduces the re
reservation by 5 percentage points, then by what amount can the
money supply provided that the banking system uses its credit
full possibilities? How will the value of the bank multiplier change?
licator?

2. Bank deposits amount to 500 thousand dollars. Required reserves are equal to 50
thousand dollars How will the bank's lending capacity and money supply change?
all sides banking system, if the depositor withdraws 20 thousand dollars from the account.
to buy a new car?

3. The amount of deposits of a commercial bank increased by 60 thousand dollars. Nor
The required reserve ratio is 20%. Identify Credit Opportunities
this bank and the banking system as a whole. How has the total deposit amount changed?
zits of the entire banking system?

4. Bank deposits amount to 350 thousand dollars. Required reserves of the bank -
70 thousand dollars Excess reserves of the bank - 30 thousand dollars. What are the actual
bank reserves? What volume of loans has the bank already issued? How will de
tender mass if the bank fully utilizes its lending capacity?

5. Bank multiplier equals 5. Maximum additional count
The quality of money that the banking system can create is $40 million.
Determine the reserve ratio and the amount of loans issued by banks.
How will the supply of money in the economy change if the reserve requirement is
will it increase by 5 percentage points?

6. The required reserve ratio is 12%. The amount of commercial deposits
Russian bank - 20 thousand dollars. The bank can issue loans of no more than 16.8
thousand dollars What are the bank's excess reserves as a percentage of deposits?

Related information.

1. The actual reserves (Rf) of a commercial bank are 220 thousand rubles. Deposits are equal to 950 thousand rubles. The required reserve ratio (r) is 20%. How might the money supply (M) change if a bank decides to use all of its excess reserves (Re) to make loans?

It is known that the change in the money supply is equal to the product of the bank multiplier and the excess reserves of a commercial bank:

The value of mb is inversely proportional to the required reserve ratio, that is

mb = 1/r = 1/0.2 = 5.

The amount of excess reserves is equal to the difference between actual and required reserves:

Re = Rf – Rr = Rf - D´r =

220 - 950´0.2 = 30 (thousand rubles)

Then M = 30´5 = 150 (thousand rubles).

2. The required reserve ratio r is 20%. A commercial bank keeps another 5% of its deposits as excess reserves. The amount of deposits is 10,000. What maximum amount L bank can use to issue loans.

The value of L is equal in this case to the bank’s actual reserves: L = Rf = D – Rr – Re =

D - D´r - D´0.05 =

10000 - 10000´0.2 - 10000´0.05 = 7500.

More on topic 13.6 PROBLEMS AND SOLUTIONS:

1. Kruschwitz L, Schaefer D., Schwake M.. Financing and investment. Collection of problems and solutions / Transl. with him. under the general editorship of 3. A. Sabov and A. L. Dmitriev. - St. Petersburg: Peter, 2001. - 320 e.: ill. - (Series “Textbooks for Universities”), 2001
2. AMIR E.S. PRACTICUM ON FINANCIAL MANAGEMENT Educational and business situations, tasks and solutions, 1997, 1997

Task 1.

The total reserves of a commercial bank are 250 million den. units. Deposits are equal to 980 million den. units The required reserve ratio is 20%. How might the money supply change if a bank decides to use all its excess reserves to make loans?

Solution:

With a required reserve rate of 20%, the amount of required reserves will be: 980 x 0.2 = 196 (million monetary units)

Excess reserves are equal to: 250 – 196 = 54 (million monetary units).

If they were all used to issue loans, then the additional supply of money could be:

Where
- additional supply of money;

- excess reserves of a commercial bank;

- deposit multiplier, which is determined by the formula:
, Where - the norm of required reserves. From here,
= 270 (million monetary units)

Task 2.

The required reserve ratio is 20%. A commercial bank keeps another 5% of its deposits as excess reserves. The amount of deposits is 20,000. What is the maximum amount the bank can use to issue loans?

Solution:

The amount of required reserves is: 20,000 x 0.2 = 4,000.

Excess reserves are equal to: 20,000 x 0.05 = 1,000.

Total reserves are: 4,000 + 1,000 = 5,000.

If reserves are 5,000, then the bank can use the remaining funds to issue loans: 20,000 – 5,000 = 15,000.

Task 3.

central bank buys government bonds from commercial banks in the amount of 100 million den. units How might the money supply change if commercial banks fully use their credit capabilities, provided that the deposit reservation rate is 10% (0.1), (rr).

Solution:

By purchasing bonds, the Central Bank increases the reserves of commercial banks by 100 million den. units As a result, commercial banks have excess reserves, which they can fully use to issue loans. The maximum possible increase in the money supply ΔM will be:

Task 4.

In 1996, real GNP was 3,000 billion. units, money supply (M) 600 billion den. units The velocity of money circulation (V) was 5 revolutions per year. In 1997, real GNP (Y) increased by 100 billion. food money supply(M) by 200 billion den. units

What was the inflation rate if the velocity of money did not change?

Solution:

According to the equation of the quantity theory of money:

M x V = P x Y, where P is the price level.

For 1996
.

For 1997

Consequently, the inflation rate was 29%.

Task 5.

Let's assume that each transaction dollar circulates on average 4 times a year and is used to purchase final goods and services. The nominal volume of GNP is 2000 billion dollars. Define:

A) the amount of money demanded for transactions;

Solution:

According to the quantity theory of money, the demand for money for transactions is determined using the exchange equation MV = PQ, where M is the amount of money in circulation, V is the velocity of circulation monetary unit, P – price level (price index), Q – output volume (in real terms), i.e. nominal GNP (PxQ). Therefore, M = PQ: V = 2000: 4 = 500 billion dollars.

B) The table shows the amount of money demanded by assets at various interest rates. Using the data you obtained in answer to question A), indicate in the table the total demand for money.

Solution:

Total demand for money = demand for money for transactions + demand for money from assets at each level of interest, i.e.

500 + 20=520; 500+40=540 billion dollars etc. We write the results obtained in column No. 3 of the table.

C) The money supply is $580 billion. Determine the equilibrium interest rate.

Solution:

Equilibrium on money market established when the total demand for money equals its supply. Therefore, at an interest rate of 10%, the demand for money is 580 billion dollars. equal to the money supply of 580 billion dollars.

D) Determine the equilibrium value interest rate, if the money supply increased to 600 billion dollars. decreased to 540 billion dollars.

Solution:

With the money supply growing to 600 billion dollars. equilibrium in the money market will be established at an equilibrium interest rate of 8%, with a reduction in the money supply to 540 billion dollars. – the equilibrium rate will increase to 14%.

E) Determine how the total demand for money will change at each level of the interest rate and the equilibrium interest rate if the volume of nominal GNP increases by 80 billion dollars; will be reduced by 120 billion dollars.

Solution:

Growth of nominal GNP by 80 billion dollars. at a constant speed of money turnover (4 times) will lead to an increase in the demand for money for transactions, which will amount to 2080: 4 = 520 billion dollars. Total demand will accordingly also increase at each percentage level (540,560,580,600,620,640,660). We enter the results in column No. 4 of the table. If the money supply remains at the original level ($580 billion), then equilibrium will be established at an interest rate of 12%

Decrease in nominal GNP by $120 billion. will lead to a decrease in the demand for money for transactions to 470 billion dollars. ((2000 – 120):4). As a result, the overall demand for money will decrease at each level of the interest rate (490,510,530,550,570,590,610) billion dollars. The results are transferred to column No. 5 of the table. Provided that the money supply remains at the level of 580 billion dollars, equilibrium in the money market will be established at an interest rate of 5%.

Problems for calculating money multipliers

Problem 1

Formulation of the problem: The Central Bank set the required reserve requirement at 12.5%. Determine the bank multiplier.

Technology for solving the problem: The bank multiplier is determined by the formula:

Therefore, the multiplier is equal to: .

Answer: m = 8

Problem 2

Formulation of the problem: The reserve ratio in the country is 20%, the excess reserve ratio is 5%, and the deposit ratio is 50%. Define money multiplier.

Technology for solving the problem: The money multiplier is determined by the formula:

Answer: the multiplier is 2.

Tasks for creating money in the credit and banking system

Problem 3

Formulation of the problem: Small time deposits amount to 81.5 million den. units, large immediate plans - 32.3 million den. units, check deposits – 22.4 million den. units, checkless savings deposits– 15 million den. units, cash – 48.8 million den. units Based on these data, determine the units M1, M2, MZ.

Technology for solving the problem: Unit M1 includes cash, checkable deposits and checkless savings deposits:

M2 includes M1 and small time deposits:

The M3 aggregate includes M2 and large time deposits:

Answer:

M1 = 86.2 million den. units, M2 = 167.7 million den. units,

M3 = 200 million den. units

Problem 4

Formulation of the problem: Came to bank A new deposit in the amount of 20,000 USD. That is, the mandatory reserve rate in the country is 10%. By how much will Bank A's lending capacity increase?

Technology for solving the problem: Since banks are required to keep part of their deposits in the form of reserves, lending opportunities increase by the volume of new deposits minus the required reserve:

Answer: will increase by 18,000 USD. e.

Problem 5

Formulation of the problem: Bank X received two new deposits for $10,000 and $15,000. e. The mandatory reserve rate is 20%. Determine how much the lending capabilities of Bank X will increase and how much the money supply can increase maximum?

Technology for solving the problem: The lending capacity of Bank X increases by the volume of new deposits minus the required reserve: To find out how the money supply in the economy can increase, the growth of the lending capacity of Bank X must be multiplied by the bank multiplier:

.

Answer: the lending capacity of Bank X will increase by 20,000 USD. e., money supply - per 100,000 USD. e.

Problem 6

Formulation of the problem: Based on the following data, determine how the money supply in the country will change:

1. The Central Bank bought from the population for cash securities government in the amount of 200 USD. e.
2. The Central Bank sold state securities to commercial banks in the amount of 500 cu. e.
3. The Central Bank reduced the interest rate, as a result, commercial banks took out additional loans in the amount of 50 million den. units
4. The government purchased equipment worth 1000 million den. units, paying with checks for treasury deposits.

The mandatory reserve requirement in force in the country is 10%.

Technology for solving the problem: The increase in the money supply occurs due to the increase in cash and deposit money with a multiplier effect: . Therefore, we will consider each operation separately.

Now you can determine overall change money supply:

Answer: it will increase by 5700 USD. e.

Problem 7

Formulation of the problem: Mr. Wilner closed his account at Bank X, withdrawing $10,000. The mandatory reserve rate is 25%. How much will the money supply of this bank and the entire banking system decrease? What happens if the mandatory reserve ratio decreases to 20%?

Technology for solving the problem: The supply of money by Bank X will decrease by the volume of withdrawn deposits minus the required reserve: 10,000 – 0.25 * 10,000 = $7,500. To find out how the money supply in the economy will decrease, you need to multiply the change in supply by Bank X by the bank multiplier:

^M = 7500 * 1/0.25 = $30,000.

If the reserve ratio becomes 20%, then the supply of money by Bank X will decrease by 10,000 - 0.2 * 10,000 = $8,000. The money supply in the economy will decrease by 8000 * 1/0.2 = $40,000.

Answer: at 25%, the supply of money by Bank X will decrease by $7,500, by the entire system - by $30,000.

At 20%, supply will decrease by $8,000 by Bank X and $40,000 by the entire banking system.

Problem 8

Formulation of the problem: The monetary base in the economy is 2000 USD. e. The ratio of cash: deposits is 3: 1. The required reserve ratio is 10%. Determine the money supply.

Technology for solving the problem: The monetary base consists of cash and deposits. Since their ratio is 3: 1, then the cash in the database is 1500 USD. e., deposits 500 USD. e. The money supply can be calculated as follows:

Substituting the values, we get:

Answer: 6500 USD e.

Problem 9

Formulation of the problem: The monetary base increased by 1000 cu. That is, while the amount of cash remained unchanged. Determine how the money supply will change if the money multiplier is 3.

Technology for solving the problem:

, therefore, the increase in the money supply

Answer: will increase by 3000 USD. e.

Problem 10

Formulation of the problem: The monetary base in the economy increased by 1500 USD. e. The reserve ratio is 12%, the cash balance ratio is 3%, and the cash preference ratio is 45%. Determine how much the money supply will increase.

Technology for solving the problem: The growth of the money supply is determined by the growth of the monetary base and the multiplier:

.

The multiplier is determined by the formula:

Therefore, the increase in money supply

Answer: for 3615 USD. e.

Tasks to determine the demand for money

Problem 11

Formulation of the problem: Real GNP in the economy 2000 den. units, price level – 2; The monetary unit makes 10 revolutions per year. Determine the transaction demand for money.

Technology for solving the problem: Transaction demand for money is determined by the formula:

Substituting the values, we get:

Answer: 400 den. units

Problem 12

Formulation of the problem: Real GNP in the economy is 6000 den. units, price level – 3; The monetary unit makes 9 revolutions per year. The dependence of the demand for money on the interest rate is presented in the table. Draw graphs of transactional, speculative, and general demand for money.

Technology for solving the problem: First, we determine the transaction demand for money using the formula:

Substituting the values, we get:

3 * 6000: 9 = 2000 den. units The transaction demand for money graph will be a vertical line:

The schedule of speculative demand for money is constructed point by point, based on the dependence of demand on the interest rate given in the table, i.e. at a 15% rate, there will be no demand for money as a financial asset. The lower the rate, the greater the need, so the graph will be a downward sloping line.

The total demand for money is defined as the sum of transaction demand and speculative demand, i.e. at a rate of 15% - 2000 + 0 = 2000, at a rate of 10% - 2000 + 1000 = 3000, etc. The total demand schedule is also made up of graphs transactional and speculative demand:

Equilibrium problems in the money market

Problem 13

Formulation of the problem: Real GNP in the economy is 100,000 den. units, price level – 2; The monetary unit makes 8 revolutions per year. The dependence of the demand for money on the interest rate is presented in the table:

Determine at what interest rate equilibrium will be established in the money market if the money supply in the economy is equal to 35,000 den. units

Technology for solving the problem: First, the demand for money for transactions is determined using the formula den. units Since the money supply (money supply) is equal to 35,000 den. units, then only 10,000 den. remains to meet speculative demand. units Therefore, at a rate of 15%, equilibrium will be established in the money market.

Answer: 15%.

Problem 14

Formulation of the problem: Real GNP in the economy is 50,000 den. units, price level - 3; The monetary unit makes 7.5 revolutions per year. The dependence of the demand for money on the interest rate is presented in the table:

Determine at what interest rate equilibrium will be established in the money market and how it will change if the money supply in the economy decreases from 31,000 to 28,000 den. units

Technology for solving the problem: First, the demand for money for transactions is determined by the formula: P * GNP/v, i.e. 3*50000:7.5=20000 den. units Since the money supply (money supply) was initially equal to 31,000 den. units, then 11,000 den. were left to satisfy speculative demand. units Consequently, at a rate of 6%, the initial equilibrium in the money market was established. The decrease in the money supply led to a reduction in the funds available for speculative needs to 8,000 den. units As a result, the interest rate increased to 8%, and equilibrium in the money market was restored.

Answer: will increase from 6 to 8%.

Problem 15

Formulation of the problem: The supply of money is carried out according to the formula. Speculative demand for money is determined by the formula. The annual GNP is 8400 USD. That is, the price level is 1, the turnover rate of the monetary unit is 12 revolutions per year. Determine the equilibrium interest rate.

Technology for solving the problem: First, the demand for money for transactions is determined using a formula. Substituting the values, we get: u. e. Then we find the total demand for money by adding transactional and speculative demand: . Now let’s find equilibrium in the money market: Мs = L, i.e. 45+150i=725–60i. Consequently, at a rate of 3, equilibrium will be established in the money market.

Answer: i = 3.

Tasks on the influence of the money supply on real and nominal indicators

Problem 16

Formulation of the problem: The demand for money for transactions is determined by the formula, financial assets . The supply of money in the economy is carried out according to a formula. Determine: a) the equilibrium interest rate in the economy if GNP is equal to 1000 USD. e.;

b) GNP if the money supply increases by 100 cu. e. (at a constant interest rate).

Technology for solving the problem: First, the total demand for money is determined by adding transactional and speculative demand: . Then the equilibrium in the money market is found: , i.e. . At Y = 1000, i = 20. If the money supply increases by 100, then

; 0.5U = 600; Y = 1200.

Answer: a) 20; b) 1200 USD e.

Problem 17

Formulation of the problem: The nominal supply of money increased by 10% over the year, at the same time the price level increased by 8%, and the rate of turnover of the monetary unit increased by 5%. How will real GNP change?

Technology for solving the problem: To solve the problem, you need to use the equation of quantitative exchange: . Hence, the growth of GNP is determined by: .

Y = 1.069, i.e. GNP increased by 6.9%.

Answer: increased by 6.9%.

Problem 18

Formulation of the problem: The economy was in a state long-term equilibrium with a potential GNP of 6000 USD. That is, the price level is 1, the rate of turnover of the monetary unit is 10 revolutions per year, while the money market was in equilibrium at an interest rate of 5. Speculative demand for money is determined by the formula

M d = 300 – 40i. The Central Bank issued an additional 200 deniers. units What will happen in the economy if the interest rate does not change?

Technology for solving the problem: First, the initial money supply is determined; since there was equilibrium in the money market, the supply of money was equal to the demand for it:

Den. units Then the money supply increased and amounted to 900 den. units Since GNP is at the potential level and the interest rate does not change, prices will react. The price level will increase and will be:

, hence P = 1.5.

Answer: the price level will increase by 1.5 times.

Problems for the IS – LM model

Problem 19

Formulation of the problem:

C = 170 + 0.6Y v;

Inv = 100 – 40i;

L = 0.75Y – 6i;

Derive the formula IS.

Technology for solving the problem: The formula looks like

.

, .

Answer: IS: i = 12.5 – 0.01Y.

Problem 20

Formulation of the problem: Consider a closed economy, which is characterized by the following data:

C = 170 + 0.6Y v;

Inv = 100 – 40i;

L = 0.75Y – 6i;

Derive the LM formula.

Technology for solving the problem: .

Substituting the values ​​into the formula, we get:

LM: 0.75Y – 6i = 735, hence 6i = 0.75 –735, i = 0.125Y + 122.5.

Answer: LM: i = 0.125Y + 122.5.

Problem 21

Formulation of the problem: Consider a closed economy, which is characterized by the following data:

C = 170 + 0.6Y v;

Inv = 100 – 40i;

L = 0.75Y – 6i;

Determine the equilibrium interest rate and effective demand.

Technology for solving the problem: Let us derive the IS formula:

.

IS: Y = 170 + 0.6(Y – 200) + 100 – 20i + 350= 0.6Y – 20i + 500, hence 0.4Y – 500 = 20i;

IS: i = 12.5 – 0.01Y.

Then we define the LM curve.

Substituting the values ​​into the formula, we get:

LM: 0.75Y – 6i = 735, hence 6i = 0.75 – 735,

LM: i = 0.125Y + 122.5.

Having solved the system of equations, we obtain an equilibrium interest rate of 2.5 and effective demand Y = 1000.

Answer: the equilibrium interest rate is 2.5; effective demand is 1000.

Problem 22

Formulation of the problem: The state of the economy is characterized by the following parameters: C = 0.5Y v + 80, Inv = 300 – 10i, G = 0.1Y + 60, taxes are 100 cu. e., M s = 500, L = 0.4Y + 100 – 12i. Using the IS–LM model, determine the parameters of the joint equilibrium.

Technology for solving the problem: The IS - LM model consists of two curves, the equations of which are:

;

IS: Y = 0.5(Y – 100) +80 + 300 – 10i + 0.1Y + 60 = 0.6Y – 10i + 390,

LM: 0.4Y +100 – 12i = 500

IS: 0.4Y = 390 – 10i,

LM: 0.4Y = 400 – 12i. Having solved the system of equations, we obtain the equilibrium interest rate i = 5. Substituting it into the equation of any curve, we obtain: Y = 850.

Answer: equilibrium GNP = 850, equilibrium interest rate 5.

Problem 23

Formulation of the problem: Based on the following data, determine effective demand:

Inv = 200 – 20i;

M d sd = 0.5Y;

M d im = 500 – 50i;

Technology for solving the problem: To solve, the IS – LM model is used, the equations of which are:

;

Substituting the values ​​into the formulas, we get:

IS: Y = 0.6Y + 50 + 200 – 20i = 0.6Y – 20i + 250;

LM: 0.5Y +500 – 50i = 400.

Having solved the equations, we obtain the equilibrium interest rate of 16.5 and effective demand Y = 1450.

Answer: 1450 USD e.

Problem 24

Formulation of the problem: The population's demand for money is determined by the formula L = 0.8Y + 600 – 50i. There are 1000 deniers in circulation. units The price level is equal to 1. The investment demand of entrepreneurs is represented by the function Inv = 80 – 10i, consumer demand is defined as: C = 1200 + 0.6Y v. Government spending on GNP are equal to taxes and equal to 500 den. units

How will the equilibrium interest rate and equilibrium GNP change if the quantity of money in circulation decreases by 100 den. units

Technology for solving the problem: The problem is solved by determining the equations of the IS, LM curves:

;

Substituting the values ​​into the formulas, we get:

IS: Y = 0.6(Y – 500) + 1200 + 80 – 10i + 500 = 0.6Y – 10i + 1480;

LM: 0.8Y + 600 – 50i = 1000;

IS: i = 148 – 0.04Y;

LM: i = 0.016Y – 8.

Having solved the equations, we obtain the equilibrium interest rate of 36.57 and effective demand Y = 2785.7.

If the amount of money decreases, then LM will take on a different form: 0.8Y + 600 – 50i = 900 or LM: I = 0.016Y – 6. Let’s solve the equations of the IS – LM model, as a result we get an interest rate of 38 and GNP = 2750 den. units Thus, the interest rate will increase by 1.43, and GNP will decrease by 35.7 den. units

Answer: the interest rate will increase by 1.43, and GNP will decrease by 35.7 den. units

Problem 25

Formulation of the problem: In a closed economy without government participation, consumption is determined by the function C = 0.75Y + 60, investment – ​​Inv = 200 – 5i. The demand for money as property is given by the formula M d im. = 300 – 10i, demand for money for transactions M d sd. = 0.5Y. There are 450 deniers in circulation. units Determine the equilibrium values ​​of the interest rate and GNP and their change if the marginal propensity to consume increases to 0.8.

Technology for solving the problem: We find the initial equilibrium using the equations of the IS and LM curves. Since there is no state or foreign sector, the savings function can be derived and its formula can be equated to the investment formula:

IS: Inv = S; 200 – 5i = 0.25Y – 60; Y = 1040 – 20i;

LM: 0.5Y = 10i – 300; Y = 20i – 300.

Having solved the system of equations, we obtain an equilibrium interest rate of 18.5 and an equilibrium GNP of 670 den. units

If the consumption function changes, the saving function will also change. As a result, the IS curve equation will look like this:

IS: 200 – 5i = 0.2Y – 60; Y = 1300 – 25i;

LM: Y = 20i – 300.

Having solved the equations, we get: i = 22.2; GNP = 743 den. units, i.e. there was an increase in the interest rate and GNP.

Answer: the interest rate increased from 18.5 to 22.2; GNP increased from 670 to 743 den. units

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Bank's required reserve ratio

In order to operate without claims from the Central Bank, each bank is obliged to comply with established rules and regulations. One of these norms is the required reserve norm (RRR). Its introduction has become the main instrument of monetary policy and a guarantor of the fulfillment of the bank’s obligations to its clients, even if financial position the bank was shaken.

The reserve allows the Central Bank to insure deposits of depositors. NRA also affects the volume of loans issued, overall inflation of the national currency and the issuance of non-cash debt. Even the smallest increase in the reserve ratio can lead to a large drop in bank activity. The Central Bank tries to keep reserve norms at the same level, otherwise changes will have a painful impact on credit institution. When the norm increases, the bank is forced to look for additional money to ensure financial stability. Money is taken from two sources: Central Bank loans and sales own shares. Both methods reduce liquidity. If the standard is lowered, the bank frees up free funds, which are used to pay off current debt and increase liquidity.

What is a bank's required reserve ratio?

NOR is statutory obligation norm credit organization on attracted deposits, which must be transferred for storage to the Central Bank. It can be kept as a deposit or in cash. It is also a guarantee fund, through which obligations to clients will be fulfilled in full.

The Central Bank uses the NRA to regulate the activities of all banks. Currently, the NRR is 4.25%. When conducting monetary policy, The Central Bank uses the main tool - changing the NOR. With its help, the volumes of non-interest bearing deposits held in special accounts of the national bank are regulated.

The NRR is set as a percentage of the bank's deposits. Depending on the type of deposit, its value may change in direct proportion to liquidity. The larger the bank, the higher the norm will be for it.

The decision to increase the NRR can be made by the Central Bank in order to reduce the supply of money and curb inflationary processes. A decrease in NOR is introduced to activate economic growth and strengthening lending activity. After reducing the NRR, part of the amount that the bank transferred to the Central Bank can be used for lending, which will bring additional income.

It is worth noting that the Central Bank rarely uses the instrument of changing the NRR, since this has a powerful impact on the Russian banking system, which is already in a precarious position. Rash decisions to change the NRA in one direction or another can give an “apocalypse effect.”

The impact of the required reserve ratio on credit policy.

Many people imagine the work of banks like this: the bank receives a deposit at one percent and issues it as a loan at an increased rate. The difference in percentage is the bank's income. Actually this is not true.

The bank transfers part of the money from the deposit for storage to the Central Bank. So, if the NRR is 5%, then from 1 million rubles. 50 thousand rubles go to reserve. The bank can already issue the remaining funds at interest in the form of loans. This explains the difference between credit and deposit rates. In fact, all bank funds are in constant circulation.

If a situation happens that the majority of depositors come to collect their money, then the bank may find itself in a difficult situation. There are no large amounts of free funds in the bank. According to the terms, investors can claim their money at any time. Hearing that the bank refuses to issue money will cause a wave of indignation and suspicion regarding the trustworthiness of the bank. The remaining depositors will run to withdraw money from all accounts, which will undermine the stability of banks. This will lead to destabilization of the banking system, because she works "future" money.

To avoid this or at least minimize it, a mandatory reserve norm was introduced - that part of the money that is transferred for storage to the Central Bank. If there is a critical situation (invasion of depositors), the Central Bank quickly pours reserves into the bank. As soon as everyone has received their funds and the situation has calmed down, the bank continues to live according to its scenario: it accepts funds for deposit, transfers them to the Central Bank reserve, issues loans, and receives the amount back with interest.

Thus, the bank cannot issue all funds received in the form of loans. To compensate for the reserve and generate income, the loan rate is significantly higher than the deposit rate.

How is NOR calculated?

Reserves form an emergency supply of money that the bank does not have the right to use for its own purposes.

NOR = bank's required reserves/liabilities for fixed deposits

If the required reserve rate is 5%, and the bank accepted deposits for 10 million rubles, then it is obliged to send 500 thousand rubles to the reserve.

An example of NOR calculation can be seen in the figure:

By changing the NOR, the Central Bank influences the creditworthiness of the bank. By reducing the standard, the Central Bank allows the bank more money give out loans and get more profit.

Reducing the NRR is also called the “cheap money policy.” It is needed to increase volume credit money, stimulating household spending, reducing unemployment.

Increasing the NRR is part of the “policy expensive money" It reduces the bank's ability to issue loans. This, in turn, limits the amount of money in circulation and reduces inflation.

Obligations for the formation of reserves are formed by the bank from the moment of obtaining a license. Reserves are kept in the Central Bank in non-interest bearing accounts. In the event of bank liquidation, reserves are transferred to a special commission that deals with the liquidation of the credit institution. Money raised from legal entities for a period of 3 years, bonds with a maturity of 3 years, non-monetary obligations (securities, metals), and obligations to credit institutions are exempt from reservation.

If reserves are not deposited into fixed time, The Central Bank has the right to write off underpayments from the bank's correspondent account. In addition, according to Article 38 of Federal Law No. 86 of July 10, 2002, the Central Bank imposes a fine for violation of no more than double the refinancing rate of the contribution amount.

How dangerous will the size of the NRR be for the bank?

An increase in NRR may have a negative impact on the bank's position. The increase means that the bank must short time increase the share of reserves in your account with the Central Bank. It is impossible to withdraw money from circulation. The repayment periods for issued loans extend over several years. The standard cannot be changed at a time by more than 5 percentage points. Given the huge investment portfolios, even such a change can amount to a significant amount of monetary equivalent. Even the most stable bank cannot get hold of hundreds of millions of rubles in a moment.

By changing the NOR, the Central Bank keeps the bank’s liquidity to a minimum possible level. However, this may affect general situation jar. Given its complex structure, it is almost impossible to quickly adapt to new conditions. Liquidity begins to fall rapidly, which leads to a violation of other indicators. In a difficult economic situation this could lead to a crash. An increase in the NRR by a maximum of 5% may lead to bankruptcy of the bank due to the impossibility of fulfilling the requirements of the Central Bank.