Scenario: Money Supply Changes II Lucia withdraws $8,000 from her chequing account to pay tuition this semester. Assume that the reserve requirement is 20% and that banks do not hold excess reserves. As a result of the withdrawal, excess reserves. by a) increase; $8,000 b) decrease; $6,400 c) decrease; $1,600 d) decrease; $8,000

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A: a)

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Q: a) Suppose that Tk.10,000 in new taka bills (never seen before) falls magically from the sky into…

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Q: Scenario: Money Supply Changes II Lucia withdraws $8,000 from her chequing account to pay tuition…

A: The scenario involves Lucia withdrawing $8,000 from her chequing account to pay for her tuition.…

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A: Central bank:  It means an apex financial institution of the country.  Liabilities are the deposit…