The Bank of Canada reports that it has coins valued at $15 billion, chartered banks' reserves of $25 billion, gold valued at $12 billion, Bank of Canada notes of $500 billion, and Government of Canada securities of $200 billion. What is the size of the monetary base?
2007-04-04 13:51:30 · 2 answers · asked by Anonymous in Social Science ➔ Economics
As before, you need to first draw a T diagram that describes the balance sheet of the B of C. Then, review the definition for the monetary base -- using your text book -- and then calculate the answer using the B of C's balance sheet.
2007-04-04 13:56:44 · answer #1 · answered by Allan 6 · 0⤊ 0⤋
Monetary base is a narrow definition of Money Supply.
It includes bills, coins and chartered bank reserves.
15+25+500 = $540 Billion
2007-04-04 21:54:08 · answer #2 · answered by JuanB 7 · 0⤊ 0⤋