If the required reserve ratio is 10 percent,currency in circulation is $400 billion,checkable deposits are $800 billion,and excess reserves total $0.8 billion,then the monetary base is

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The monetary base is calculated by adding the currency in circulation to the total reserves held by banks. Since the required reserve ratio is 10 percent for $800 billion in checkable deposits, the required reserves are $80 billion (10% of $800 billion). Given that there are no excess reserves, the total reserves are $80 billion. Therefore, the monetary base is the sum of currency in circulation ($400 billion) and the total reserves ($80 billion), which equals $480 billion. However, since there are $0.8 billion in excess reserves, these should also be included, making the correct total $480.8 billion.

If the Required Reserve Ratio Is 10 Percent,currency in Circulation