The table shows the commercial banks' balance sheet (aggregated over all the banks). The commercial banks' desired reserve ratio on all deposits is 10 percent and there is no currency drain. Assets Liabilities (millions of dollars) Reserves at the Fed 30 What is the quantity of loans and the quantity of total deposits when the banks have no excess reserves? Checkable deposits 115 Savings deposits Cash in vault 5 75 Securities 40 >>> Answer to 2 decimal places. Loans 115 The total quantity of loans after the banks have lent all their excess reserves is million.
The table shows the commercial banks' balance sheet (aggregated over all the banks). The commercial banks' desired reserve ratio on all deposits is 10 percent and there is no currency drain. Assets Liabilities (millions of dollars) Reserves at the Fed 30 What is the quantity of loans and the quantity of total deposits when the banks have no excess reserves? Checkable deposits 115 Savings deposits Cash in vault 5 75 Securities 40 >>> Answer to 2 decimal places. Loans 115 The total quantity of loans after the banks have lent all their excess reserves is million.
Chapter14: Banking And The Money Supply
Section: Chapter Questions
Problem 2.3P
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