If Currency and Deposits are the same, shouldn't CR be equal to 0.5? If CR = 1 then there won't be any deposits? Maybe I'm missing something but this is a bit unintuitive.
I think you might be thinking of cr as "the fraction of the money that is held as cash/currency" (C/(C+D)) which suggests 1 is an extreme value, the highest possible value. The definition here is cr = C/D, not cr = C/(C+D) so 1 isn't an extreme or unusual value, it just means C = D.
I was so confused, thank you it made so much sense.
This was a really helpful video! Thank you
Thank you so much!
why is cr .5/.5 and rr not .25/.75? if rr is simply .25 shouldnt cr also just simply by .5
good
If Currency and Deposits are the same, shouldn't CR be equal to 0.5? If CR = 1 then there won't be any deposits? Maybe I'm missing something but this is a bit unintuitive.
I think you might be thinking of cr as "the fraction of the money that is held as cash/currency" (C/(C+D)) which suggests 1 is an extreme value, the highest possible value. The definition here is cr = C/D, not cr = C/(C+D) so 1 isn't an extreme or unusual value, it just means C = D.
if cr goes up m also goes up