c and d Balance sheet of the Winter Bank Assets Liabilities Cash $ 8,000 Deposited with the Fed $ 4,000 Loans $ 138,000 Deposits $ 100,000 Capital $ 50,000 Total $ 150,000 Total $ 150,000 The required reserve ratio on all deposits is 10% a. What, if any, are this bank's excess reserves? b. How much new amount of loan will this bank be able to create because of the excess reserves? c. How much new amount of loan will the entire banking system be able to create because of this excess reserves? d. Answer part a, b and c if the required reserve ratio is changed to 8%.
c and d Balance sheet of the Winter Bank Assets Liabilities Cash $ 8,000 Deposited with the Fed $ 4,000 Loans $ 138,000 Deposits $ 100,000 Capital $ 50,000 Total $ 150,000 Total $ 150,000 The required reserve ratio on all deposits is 10% a. What, if any, are this bank's excess reserves? b. How much new amount of loan will this bank be able to create because of the excess reserves? c. How much new amount of loan will the entire banking system be able to create because of this excess reserves? d. Answer part a, b and c if the required reserve ratio is changed to 8%.
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter21: The Monetary System
Section: Chapter Questions
Problem 4PA
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c and d
Assets |
Liabilities |
Cash $ 8,000 Deposited with the Fed $ 4,000 Loans $ 138,000 |
Deposits $ 100,000 Capital $ 50,000 |
Total $ 150,000 |
Total $ 150,000 |
The
a. What, if any, are this bank's
b. How much new amount of loan will this bank be able to create because of the excess reserves?
c. How much new amount of loan will the entire banking system be able to create because of this excess reserves?
d. Answer part a, b and c if the required reserve ratio is changed to 8%.
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