A: There are four important roles in the process of money supply, namely, the central bank, commercial banks and financial institutions, depositors and borrowers. The variables affected by these four roles mainly include: statutory deposit reserve ratio, loan realization rate, excess reserve ratio, the ratio of time deposits to demand deposits and other factors that affect the base currency. (1) statutory deposit reserve ratio. Assuming other variables remain unchanged, if the central bank raises the statutory deposit reserve ratio, commercial banks and financial institutions will need to deposit more deposit reserves, and the resulting reserve shortage means that banks must shrink their loans, thus weakening their ability to create deposits and reducing the money supply. Therefore, the statutory deposit reserve ratio is negatively related to the money multiplier and money supply. (2) loan realization rate. When other variables remain the same, the increase of this ratio means that the borrower will convert demand deposits into cash, that is, withdraw part of the loans in cash instead of transferring demand deposits. Due to the decrease of demand deposits, the ability of deposit expansion decreases, thus making the money multiplier smaller and the money supply reduced. Therefore, the loan realization rate is negatively related to the money multiplier and money supply. (3) Excess reserve ratio. When the excess reserves held by banks increase, in order to meet the requirements of statutory deposit reserve, banks must shrink loans, thus weakening the creativity of bank deposits and reducing the money supply. Therefore, the excess reserve ratio is negatively related to the money multiplier and money supply. (4) The ratio of time deposits to demand deposits. When the ratio of bank time deposits to demand deposits rises, the money multiplier of M2 becomes larger and the money supply increases. This is because, since the 1990s, the central banks in western countries have a tendency to reduce the statutory reserve ratio, and many countries have reduced the statutory reserve ratio of time deposits to zero, thus increasing the ability of deposit expansion. Therefore, the ratio of time deposit to demand deposit is positively related to money multiplier and money supply. (5) Other determinants. These are the factors that determine the money multiplier, and other factors that determine the money supply are related to the base money. According to the source of base currency, it can be divided into two parts: borrowed base currency and non-borrowed base currency. The former is obtained through discounted loans from the central bank, while the latter is obtained through open market business. Under the condition that the non-lending base currency remains unchanged, the discount loan of the central bank is positively related to the money supply; The amount of discount loans obtained by commercial banks and financial institutions from the central bank depends on the discount rate, which is negatively correlated with the discount rate, that is, the higher the discount rate, the less discount loans obtained by commercial banks and financial institutions from the central bank, and vice versa. When other variables remain unchanged, the non-lending base money is positively related to the money supply, that is, the more base money commercial banks and financial institutions obtain through the open market, the more money supply there will be, and vice versa.