In short, when the ratio of time deposits to demand deposits increases, the money multiplier will become larger, because the increase of time deposits will lead banks to borrow more funds, so the money multiplier will become larger.

Introduction:

Time deposit is also called "time deposit certificate". A deposit in which the bank and the depositor agree on the term and interest rate in advance at the time of deposit and withdraw the principal and interest after maturity. If depositors need funds before maturity, some certificates of deposit can be sold in the market; Some certificates of deposit cannot be transferred. If depositors choose to withdraw funds from the bank before maturity, they need to pay a certain fee to the bank. ?

Cash and current savings deposits can be directly applied for time savings deposits. The initial deposit for a fixed account is 50 yuan, and there is no deposit limit. The storage period is three months, six months, one year, two years, three years and five years. Partial withdrawal can be made in advance. When the deposit expires, the principal and interest can be withdrawn by the certificate of deposit, or it can be automatically transferred in installments according to the original deposit period.