Money Multiplier Calculator

Analyze how deposit creation unfolds under varying reserve requirements, currency drain, and excess reserves. Compute the money multiplier and resulting money supply while testing scenario sensitivities and base adjustments. Visualize relationships through dynamic curves and export findings as CSV or PDF.

Choose the money multiplier model.
Enter as a percent (e.g., 10 for 10%).
Public currency preferences; set to 0 for simple textbook case.
Bank reserve decisions beyond required minimums.
High-powered money (e.g., notes + reserves). Output M = m × B.
Minimum RR for graph.
Maximum RR for graph.
Sample points between min and max RR.
Results
Money Multiplier m
6.774194
Money Supply M = m × B
677,419.35
Inputs Snapshot
Mode: advanced
rr: 10%, c: 5%, e: 0.5%
Base B: 100,000.00
Graph: Money Multiplier and implied Money Supply across required reserve ratios.
RR (%) c (%) e (%) m B M = m×B
1.00 5.00 0.50 16.153846 100,000.00 1,615,384.62
5.00 5.00 0.50 10.000000 100,000.00 1,000,000.00
10.00 5.00 0.50 6.774194 100,000.00 677,419.35
20.00 5.00 0.50 4.117647 100,000.00 411,764.71
30.00 5.00 0.50 2.957746 100,000.00 295,774.65
Example scenarios (holding c and e fixed when using the advanced model).
Formulas Used

Simple textbook multiplier (no currency drain, no excess reserves):

m = 1 / rr

where rr is the required reserve ratio as a decimal (e.g., 0.10 for 10%).

Advanced multiplier with currency drain and excess reserves:

m = (1 + c) / (c + rr + e)

c = currency-deposit ratio (public preference for holding cash), rr = required reserve ratio, e = excess reserve ratio (banks choosing to hold extra reserves). All are decimals.

Money supply identity: M = m × B, where B is the monetary base (sometimes called high-powered money).

How to Use
  1. Select Model: choose Simple for m = 1/rr, or Advanced to incorporate currency drain (c) and excess reserves (e).
  2. Enter rr, and if applicable, c and e as percentages.
  3. Provide your Monetary Base (B) to compute the implied money supply M = m × B.
  4. Adjust the Sweep RR range and Steps to explore sensitivity on the graph.
  5. Press Calculate. The results, example table, and graph update instantly.
  6. Use Export CSV to download the example table; use Export PDF to save the results card.
  7. Document assumptions and units when comparing across countries or regulatory regimes.
FAQs

It indicates how much the total money supply can expand for a given monetary base, given reserve requirements, currency preferences, and bank reserve behavior.

Because it ignores currency drain (people holding cash) and excess reserves (banks holding more than required), both of which reduce deposit creation relative to the base.

Use any currency units consistently (e.g., PKR, USD). The calculator multiplies the dimensionless m by your base B to produce money supply M in the same currency units.

Yes. With high currency-deposit ratios, high required reserves, or large excess reserves, the multiplier can be near 1 or below practical expansion levels.

It visualizes sensitivity of m (and M) to policy changes in reserve requirements. You can hold c and e fixed to isolate the rr effect.

It is a standard textbook framework. Real systems add frictions (capital rules, liquidity coverage, payment system effects). Treat results as stylized rather than predictive forecasts.

Yes. Copy values directly or print the PDF. You can also bookmark with GET parameters if you modify the form method to GET for shareable links.

Educational use only. No investment, regulatory, or policy advice.

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Important Note: All the Calculators listed in this site are for educational purpose only and we do not guarentee the accuracy of results. Please do consult with other sources as well.