Question

In a commercial banking system, how is the supply of money increased and decreased?

In a commercial banking system, how is the supply of money increased and decreased?

Homework Answers

Answer #1

Answer

the money supply or money stock, is the total amount of money available in an economy at a specific time.

[1] There are several ways to define "money," but standard measures usually include currency in circulation and demand deposits (depositors' easily accessed assets on the books of financial institutions).[2][3]


Money supply data are recorded and published, usually by the government or the central bank of the country.

Public and private sector analysts have long monitored changes in money supply because of its possible effects on the price level, inflation and the business cycle.[4]

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