MEASREMENT OF MONEY SUPPLY AND ITS DETERMINANTS
Money supply(M) = chequable deposits held by public in the commercial
bank(D) + currency in the hands of public(C)
Therefore, M = D + C
Money supply depends on the interactions between the activities of the public, commercial
banks, and the Central banks.
Supply of Money
Deposits with the commercial
Currency held by public banks
Reserve Bank Loan
Deposit of the commercial
Vault cash or Free Reserve bank with the central bank or
Required Reserve
Money supply(M) = chequable deposits held by public in the commercial
bank(D) + currency in the hands of public(C)
Therefore, M = D + C
Money supply depends on the interactions between the activities of the public, commercial
banks, and the Central banks.
Supply of Money
Deposits with the commercial
Currency held by public banks
Reserve Bank Loan
Deposit of the commercial
Vault cash or Free Reserve bank with the central bank or
Required Reserve