Money multiplier refers to the multiple relationship between money supply and base money. Simply put, the money multiplier is the amount of money produced by a unit reserve. The complete monetary (policy) multiplier is calculated as follows: k=(Rc+ 1)/(Rd+Re+Rc). Among them, Rd, Re and Rc respectively represent the statutory reserve ratio, excess reserve ratio and the proportion of cash in deposits. The basic calculation formula of money (policy) multiplier is: money supply/base money. Money supply is equal to the sum of money (that is, cash in circulation) and demand deposits; The base currency is equal to the sum of money and reserves.