Economics · Monetary Economics
High-powered money, also known as the monetary base, is defined as:
- 1The total volume of credit and advances extended by commercial banks.
- 2The total vault cash and liquid assets held exclusively by commercial banks.
- 3The sum of currency held by the public and total commercial bank reserves.✓
- 4A commercial bank's reserves held at the central bank.
Correct answer
The sum of currency held by the public and total commercial bank reserves.
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