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principles of macroeconomics > regulating the banking sector (L16) > Flashcards

regulating the banking sector (L16) Flashcards

1
Q

official measure of money

A

m4=c+d

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2
Q

mb
monetary base

A

ctot + r
currency in circulation+ reserves

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3
Q

money multiplier
mm

A

mm=M4/MB
ratio of ‘broad money’ to CB money
indicates private money creation

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4
Q

how can central bank influence money creation

A

open market creations
interest rates
regulation of financial institutions

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5
Q

macro prudential regulation

A

requires banks to ensure that bank capital (equity) remains above a minimum threshold

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principles of macroeconomics (15 decks)

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