What is the importance of a money multiplier?

Interest rates are affected by the money supply. Money supply is determined by the multiplier. Hence money multiplier is important in macroeconomics. You can read about the Money Supply in Economy – Types of Money, Monetary Aggregates, Money Supply Control in the given link.

Further readings:

  1. Monetary Policy – Objectives, Roles and Instruments (UPSC Indian Economy)
  2. Topic-Wise GS 3 Questions for UPSC Mains

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