RoundDepositsRequired Reserves of 20%Excess ReservesNew LoansNone of loan proceeds are held as currency in circulation by peopleLoan proceeds redeposited1$500$100$400$4000$4002$400$80$320$3200$3203$320$64$256$2560$2564$256$51.20$204.80$204.800$204.805$204.80$40.96$163.84$163.840$163.846$163.84$32.77$131.07$131.070$131.077$131.07$26.21$104.86$104.860$104.868$104.86$20.97$83.89$83.890$83.899$83.89$16.78$67.11$67.110$67.1110$67.11$13.42$53.69$53.690$53.69Totals$2231.57$417.31$1785.26$1785.260$1785.26 Calculate the new money supply.(Enter response here.) Calculate the money multiplier.

The table given above shows money creation by commercial banks . Through the process of money…

Answered: Calculate the new money supply. (Enter…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Round	Deposits	Required Reserves of 20%	Excess Reserves	New Loans	None of loan proceeds are held as currency in circulation by people	Loan proceeds redeposited
1	$500	$100	$400	$400	0	$400
2	$400	$80	$320	$320	0	$320
3	$320	$64	$256	$256	0	$256
4	$256	$51.20	$204.80	$204.80	0	$204.80
5	$204.80	$40.96	$163.84	$163.84	0	$163.84
6	$163.84	$32.77	$131.07	$131.07	0	$131.07
7	$131.07	$26.21	$104.86	$104.86	0	$104.86
8	$104.86	$20.97	$83.89	$83.89	0	$83.89
9	$83.89	$16.78	$67.11	$67.11	0	$67.11
10	$67.11	$13.42	$53.69	$53.69	0	$53.69
Totals	$2231.57	$417.31	$1785.26	$1785.26	0	$1785.26

Calculate the new money supply.

(Enter response here.)

Calculate the money multiplier.

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