multiple answer. This question asks you to work through an open-market purchase of $4,000 in securities from Bank 1. The open-market operation then affects Bank 2, Bank 3, etc. There are no leakages into currency, and banks always hold exactly 60% of deposits as reserves. Which of the following will be results of this OMO? Bank 2's Deposits will increase by $4,000 Bank 3's Loans will increase by $640 Bank 1's Loans will increase by $2,400 O Bank 2's Reserves will increase by 60% O Bank 1's Deposits will increase by $2400 Bank 3's Reserves will increase by $960

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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multiple answer. This question asks you to work through an open-market purchase of $4,000 in
securities from Bank 1. The open-market operation then affects Bank 2, Bank 3, etc. There are
no leakages into currency, and banks always hold exactly 60% of deposits as reserves.
Which of the following will be results of this OMO?
Bank 2's Deposits will increase by $4,000
Bank 3's Loans will increase by $640
Bank 1's Loans will increase by $2,400
O Bank 2's Reserves will increase by 60%
O Bank 1's Deposits will increase by $2,400
O Bank 3's Reserves will increase by $960
Transcribed Image Text:multiple answer. This question asks you to work through an open-market purchase of $4,000 in securities from Bank 1. The open-market operation then affects Bank 2, Bank 3, etc. There are no leakages into currency, and banks always hold exactly 60% of deposits as reserves. Which of the following will be results of this OMO? Bank 2's Deposits will increase by $4,000 Bank 3's Loans will increase by $640 Bank 1's Loans will increase by $2,400 O Bank 2's Reserves will increase by 60% O Bank 1's Deposits will increase by $2,400 O Bank 3's Reserves will increase by $960
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