Gce Model Questions Vol1 2023 Economics Question 26
Practice objective / multiple choice question 26 from the 2023 Gce Model Questions Vol1 Economics examination.
Central bank requires a reserve ratio of \(10\%\) and banks hold an excess reserve of \(2\%\) of deposits. In addition, banks keep a cash‑holding ratio of \(5\%\) of deposits. If the central bank purchases government securities worth \(£50\) million, what is the maximum possible increase in the money supply? Give your answer in millions of pounds to one decimal place.
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About This Question
This is Gce Model Questions Vol1 2023 Economics Question 26. It is one of the objective questions from the 2023 Gce Model Questions Vol1 Economics examination.
Difficulty level: Medium .
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