Respuesta :
The value of the money supply according to the bank’s open economy is $150
The Monetary base = currency = $150. If the bank holds 100 % of deposits as a required reserve, then the excess reserve will be 0 and therefore there are no loans.
So, the money supply will equal the monetary base = $150.
B = C + R states that the general public owns the monetary base as money or by the banks as reserves. For instance, a dollar withdrawal from the bank results in one increase in C and one decrease in R, leaving the total unaltered.
The total quantity of money produced by the central bank in a nation is known as the monetary basis, also known as base money, money base, high-powered money, and reserve money. This comprises:
- the entire amount of currency in use by the public,
- plus the currency that is physically stored in commercial banks' vaults,
- plus the reserves kept by commercial banks in the central bank.
The money supply, which includes all of the currency in circulation as well as specific non-bank deposits with commercial banks, should not be confused with the monetary base.
A finance ministry or the central bank may influence the monetary base while enacting monetary policy.
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