Development of atm machines

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Derive the money multiplier for an economy with the following three types of leakages: (i) a cash-deposit ratio (k) desired by the public; (ii) a legally required reserve-deposit ratio (r) for the banks; and (iii) an excess reserve-deposit ratio (e) desired by the banks. Explain how the development of ATM machines, automatic electronic payment, NETs and internet banking affect the money multiplier.

Reference no: EM133083715

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