1) Vault cash is equal to $2 million, deposits by depository institutions at the central bank are $1 million, the monetary base is $15 million, and bank deposits are $35 million. Currency held by the nonbank public is A) $3 million. B) $12 million. C) $15 million. D) $20 million.

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13 September, 08:35

1) Vault cash is equal to $2 million, deposits by depository institutions at the central bank are $1 million, the monetary base is $15 million, and bank deposits are $35 million. Currency held by the nonbank public is A) $3 million. B) $12 million. C) $15 million. D) $20 million.

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Yuliana Hudson · Answer 1

B) $12 million.

Explanation:

This can be calculated as follows:

Currency held by the nonbank public = Monetary base - Vault cash - Deposits by depository institutions at the central bank

Therefore, we will have:

Currency held by the nonbank public = $15 million - $2 million - $1 million = $12 million