" The ratio of total money supply to the stock of high powered money in an economy" is referred to :

Money Multiplier

The correct answer is option (1) : Money Multiplier

• The money multiplier refers to the ratio of total money supply to the stock of high-powered money (also called the monetary base or reserve money) in an economy.

• It indicates how much money is created in the banking system from a given amount of high-powered money.

• The formula for the money multiplier is:

  Money Multiplier = Total Money Supply / High Powered Money

• High-powered money includes currency with the public and reserves held by commercial banks with the central bank.