The money multiplier is a ratio between central bank and commercial bank money and looks at how much commercial bank money can be created with a unit of central bank money. The monetary authorities can influence the supply of money by printing more, but that leads to devaluing of the currency. It is also possible to lower interest rates and make other changes that will lead to an adjustment of the ratio, thus increasing the supply of money and helping the economy. For an essay on this topic, it would be possible to focus on a specific way the economy is stimulated, along with whether it works and what types of problems it could lead to in the future.
