The following net transaction accounts have been documented by a bank for the computation of its reserve requirements (in millions). Net transaction accounts Tuesday Wednesday Thursday Friday Monday Tuesday Wednesday Thursday Frid 11th 14th 17th 18th $290 $310 $330 12th 13th 19th 20th 211 $330 $280 $310 $300 $290 $28 The average daily reserves at the Fed for the 14-day reserve maintenance period have been $26.5 million per day, and the average vault cash for the computation period has been estimated to be $1 million per day. a. What is the amount of the average daily required reserves to be held by the bank during the maintenance period? (Do not round intermediate calculations. Enter your answer in millions rounded to 3 decimal places. (e.g., 32.161)) Average daily required reserves million

The following net transaction accounts have been documented by a bank for the computation of its reserve requirements (in millions). Net transaction accounts Tuesday Wednesday Thursday Friday Monday Tuesday Wednesday Thursday Frid 11th 14th 17th 18th $290 $310 $330 12th 13th 19th 20th 211 $330 $280 $310 $300 $290 $28 The average daily reserves at the Fed for the 14-day reserve maintenance period have been $26.5 million per day, and the average vault cash for the computation period has been estimated to be $1 million per day. a. What is the amount of the average daily required reserves to be held by the bank during the maintenance period? (Do not round intermediate calculations. Enter your answer in millions rounded to 3 decimal places. (e.g., 32.161)) Average daily required reserves million

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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16
A commercial bank has $80000 in deposits. There are $6,000 in actual resources, of which $2,000 are excess reserves. Describe the Rate of return.
Find the value of money multiplier when the CRR or the cash reserve ratio is 90%
Please type the answer by computer, so that I can see it clearly. Suppose the current money supply (M) is 4.8 billion U.S. dollars, the nominal gross domestic product (GDP) is 72 billion U.S. dollars, and the actual gross domestic product (Y) is 12 billion U.S. dollars. Calculate the price level (P) and the velocity of money (V) separately. Show your steps.
The chartered banking system in Canada plays a crucial role in expanding or contracting the money supply as dictated by the monetary policy of the Bank of Canada. If excess reserves in the Canadian chartered banking system are $4,000, demand deposits are $40,000, and the desired reserve ratio is 10 percent, then actual cash reserves: Multiple Choice are $8,000. are $4,000. are $6,000. cannot be determined from this information. are $10,000.
Please type the answer by the computer, so I can see it clearly, thank you!!! Assume the Federal Reserve has a 1.5 percent federal funds rate goal (ffr*). What happens to the money supply if there is an unanticipated drop in demand for reserves and the Federal Reserve intends to keep the target rate? Explain with the aid of a supply and demand for reserves diagram.
The central bank buys $10,000 worth of bonds in the open market from Elaine, who deposits the proceeds in her checking account at MSM Bank. The required reserve ratio is 5%. (a) What is the amount by which MSM Bank’s liabilities have changed? Explain. (b) Calculate the change in required reserves for MSM Bank. Show your work. (c) What is the dollar value of the maximum amount of new loans MSM Bank can initially make as a result of Elaine’s deposit? Explain. (d) Based on the central bank’s open-market purchase of bonds, calculate the maximum amount by which the money supply can change throughout the banking system. Show your work. (e) How will the change in the money supply in part (d) affect aggregate demand and the price level in the short run? Explain.
Suppose the Fed buys $2000000 in government securities from someone who is a depositor at the First National Bank of El Reno. Lets assume the person deposits this money in this bank. Further assume that the current reserve requirement ratio is 20%. Please indicate below what will initially happen to this bank's balance sheet as a result of this transaction. Change in Reserves Change in loans Change in deposits Please indicate what will eventually happen to the nation's banking system as a result of this transaction. Change in reserves Change in loans Change in Deposits
Suppose that for every open-market operation in the amount of $1, money supply increases by $3, i.e., an open-market purchase of $1 will increase money supply by $3 and an open-market sale of $1 will reduce money supply by $3. This means that money multiplier is fixed and is equal to 3. The Fed's balance sheet is Federal Reserve Bank Assets Securities Gold $ 900 100 Liabilities Currency held by nonbank public Vault cash held by banks Reserve deposits Total liabilities $ 700 100 200 $1000 Total assets $1000 and the commercial banks' balance sheet is Consolidated Balance Sheet of Banks Liabilities Deposits $3000 Assets Vault cash Reserve deposits Loans Total assets $ 100 200 2700 $3000 Total liabilities $3000 If the Fed wants to increase money supply by 15%, then it has to buy government bonds in the amount
If reserves are scarce, how would the federal funds rate change (increase or decrease) if the Fed: (a) buys mortgage-backed securities (b) conducts overnight repo operations (c) conducts overnight reverse repo operations (d) increases the (minimum) reserve requirements Only typed Answer
When $100 is deposited in the banking system, it leads to maximum expansion in bank deposits of $1,000. What is the required reserve ratio assuming that the excess reserves are 0 Question 7 options: 10% 5% 0% 20%
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