The multiplier in a four-sector economy equals 1/(1-MPEY)

The multiplier in a four sector economy equals 1/(MPSY)

The size of the multiplier increases if the W line becomes flatter

The balanced budget multiplier means that if the government increases its taxes and purchases by the same amount, output might still increase

Sight deposits can be withdrawn on demand without penalty

No deposits can be bought and sold

With repos, people who pay money to a bank are given securities rather than a normal type of deposit

Capital includes money put up by the banks’ shareholders and money from past profits

A bank’s reserves are all held as cash in its branches

Market loans include between one bank and another

Securities include bills, bonds, and equities

Over half the assets are denominated in currencies other than sterling

Financial intermediaries offer risk transformation and maturity transformation

The Bank of England may act as a lender of last resort

A bank can increase its capital adequacy ratio by switching some funds from advances to buying more company shares

A bank can increase its capital adequacy ratio by selling some company shares and lending the proceeds as mortgages

A move which means that all workers who were in the past paid weekly will in future be paid monthly

A rise in incomes

A rise in wealth

A fall in the interest rate