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The French mathematician Blaise Pascal (1623 1662) discovered a recursive relationship among the binomial coefficients. By arranging them in a triangle, he found that each interior number is the sum of the two directly above it. (See Figure 9.3.) For example, 15 = 5 + 10. Let c(n,k) denote the coefficient in row number n and column number k (counting from 0). For example, c(6,2) = 15. Then Pascal s recurrence relation can be expressed as c(n, k) = c(n 1, k 1) + c(n 1, k), for 0 < k < n For example, when n = 6 and k = 2, c(6,2) = c(5,1) + c(5,2). EXAMPLE 9.11 Recursive Implementation of the Binomial Coefficient Function

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The Federal Reserve System manages the U.S. money supply in order to minimize in ationary pressures and promote economic stability. The Federal Reserve System, frequently referred to as the Fed, consists of twelve Federal Reserve Banks, a Board of Governors, and a Federal Open Market Committee. The Federal Reserve System is considered independent in that its policy directives are not directly in uenced by the congressional or executive branches of the federal government. Federal Reserve Banks. Each of the twelve Federal Banks has its own president, services banks in a speci c geographical area, and acts as a central bank for that region. A Federal Reserve Bank clears checks between banks, supervises and regulates banks in its region, performs bank examinations, provides currency to banks, and holds bank reserves. Private individuals and corporations do not deal directly with a Federal Reserve Bank. Board of Governors. The seven-member Board of Governors is the policy-making body of the Fed. Each member of the Board is nominated by the President of the United States for a fourteen-year, nonrenewable term. Because appointments to the Board are terminal and last for many years, members of the Board of Governors are free of political considerations in the formulation of monetary policy. Federal Open Market Committee (FOMC). The twelve-member FOMC is responsible for implementing U.S. monetary policy. It establishes directives for open-market operations which determine the M1 money supply. The seven-member Board of Governors and ve Federal Reserve Bank presidents comprise the FOMC.

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public static int c(int n, int k) { if (k==0 || k==n) { return 1; // basis } return c(n-1,k-1) + c(n-1,k); // recursion }

The basis for the recursion covers the left and right sides of the triangle, where k = 0 and where k = n.

The binomial coefficients are the same as the combination numbers used in combinatorial mathematics and computed explicitly by the formula n k+1 n 2 -----------------------------k 3 n In this context, the combination is often written c n k = and is pronounced n choose k. k For example, 8 choose 3 is 8 = (8/1)(7/2)(6/3) = 56. 3 n n! c n k = ---------------------- = -1 k! n k ! n 1 ----------2 EXAMPLE 9.12 Iterative Implementation of the Binomial Coefficient Function

This version implements the explicit formula given above. The expression on the right consists of k factors, so it is computed by a loop iterating k times:

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The Fed supplies the private sector with whatever amount of currency it wants to hold thus, the currency component of the M1 money supply is determined by the private sector. Monetary tools available to the Fed include changes in the reserve requirement, open-market operations that control the amount of reserves held by banks, and adjusting the discount rate, which may in uence the amount of reserves banks borrow from Federal Reserve Banks. Reserve-Requirement Variation. A decrease in the reserve require-

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