Assume a target reserve ratio of 5%. A cheque for $45000 is drawn on an account in Bank B and deposited in a checking deposit in Bank A. Round your final answers to 2 decimal places, if necessary. Do not enter comma "," or dollar sign ($) while entering your answer. a. By how much have the excess reserves of Bank A increased? b. How much in the form of new loans is Bank A now able to extend to borrowers? c. By how much have reserves of Bank B decreased? d. By how much have excess reserves of Bank B decreased? e. By how much has the money supply increased?

Assume a target reserve ratio of 5%. A cheque for $45000 is drawn on an account in Bank B and deposited in a checking deposit in Bank A. Round your final answers to 2 decimal places, if necessary. Do not enter comma "," or dollar sign ($) while entering your answer. a. By how much have the excess reserves of Bank A increased? b. How much in the form of new loans is Bank A now able to extend to borrowers? c. By how much have reserves of Bank B decreased? d. By how much have excess reserves of Bank B decreased? e. By how much has the money supply increased?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Paying Interest on Reserves-Problem Solving Exercise 3 (Algo) The U.S. economy is experiencing a recession. In order to smooth the economy the Federal Reserve would like to adjust the interest rate it pays on reserves. If the Fed has a goal of increasing the money supply by $25 billion, what should the change in excess reserves be if the reserve requirement is 10%? Instructions: Enter your answer as a positive number rounded to two decimal places. Excess reserves will need to (Click to select) by $ billion.
a) Suppose that Tk.10,000 in new taka bills (never seen before) falls magically from the sky into your hands. What are the minimum increase and the maximum increase in the money supply that may result? Assume the required reserve ratio is 10 percent.b) Suppose you receive Tk. 10,000 from your grandmother and deposits the money in a saving account. your grandmother gave you the money by writing a check on her saving account. Would the maximum increase in the money supply still be what you found it to be in part a) where you received the money from the sky? Why or why not? c) Suppose that instead you getting Tk. 10,000 from the sky or a check through your grandmother, you get the money from your mother who had buried it in a can in her backyard. In this case, would the maximum ncrease in the money supply be what you found it to be in part a)? Why or why not?
Below is the balance sheet for a bank. Under "Other" it has listed "$X" just think of this as the dollar amount needed to make the balance sheet balance. It is not important what that value is for this question. AssetsLiabilitiesReserves 42Deposits 245Loans 160 Securities 48Other $X Using the balance sheet above, find the level of required reserves for this bank if the required reserve ratio = 8%(Give answers to 2 decimal places as needed)
"If the required reserve ratio is 20% and the current deposit is $50,000. Calculate the amount of new money created." O"$200,000" O "$250,000" O"$10,000" "$40,000"
Consider an individual who moves to Canada and brings with him his life savings of $60,000, which he deposits in a Canadian bank. For each of the cases below, compute the overall change in deposits and reserves in the Canadian banking system as a result of this new deposit. a. 10 percent target reserve ratio; 4 percent cash drain; 6 percent excess reserves: Overall change in deposits = $ . Overall change in reserves = $ (Round your responses to the nearest dollar.) %3D b. 16 percent target reserve ratio; 5 percent cash drain; 5 percent excess reserves: Overall change in deposits = $ Overall change in reserves = $ (Round your responses to the nearest dollar.)
If banks require 10% of transaction deposit in reserve, How much is the required reserve? How much is the excess reserve?
8-10 please
Suppose that the following information describes the banking system in Belarus. Currency = $940 billion Checking Deposits = $1,475 billion Total Reserves = S198 billion Required Reserves = $177 billion (a) Calculate the level of the monetary base (MB) in the banking system of Belarus. (b) Given the above data calculate the money multiplier (m). Round vour answer to 2 decimal places.
Helen deposits $10,000 of currency into her checking account deposit at Bank A and that the required reserve ratio is 20%. As a result of her deposit, Bank A can make a maximum loan of ____ . Checking account deposits in the banking system as a whole (including the original deposit) could eventually increase up to _____ . Select one: a. $10,000 , $100,000. b. $2,000 , $10,000. c. $8,000 , $50,000. d. $50,000 , $100,000. e. $9,000 , $40,000.
Suppose a commercial banking system had 300,000 of outstanding checkable deposits and actual reserves of 20,000. If the ratio is 0.1%, the banking system can expand the supply of money by maximum of $_________ Can someone tell me how to solve that and explain please
Celine, another manager at a different branch of MillerBank in a different region of the country, faces a reserve requirement of 10%. She has excess reserves 0f $1000. What’s the maximum amount that she could increase the money supply? a.500 dollars b.1000 dollars c.10000 dollars d.100 dollars e.2000 dollars
ou just deposited $4,000 in cash into a checking account at the local bank. Assume that banks lend out all excess reserves and there are no leaks in the banking system. That is, all money lent by banks gets deposited in the banking system. Round your answers to the nearest dollar. If the reserve requirement is 1212%, how much will your deposit increase the total value of checkable bank deposits? $ If the reserve requirement is 44%, how much will your deposit increase the total value of checkable deposits? $ Increasing the reserve requirement the money supply.