The reserve ratio is 50% and all banks hold no excess reserves. How much will checkable deposits increase following a $1 increase in reserves? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a b с d $1.50 $5.00 $2.00 $0.50

1.4 Suppose you transfer $4,000 from your money market mutual fund account to your checking account. What is the immediate impact of this transfer on M1 and M2? 1.5 Why do banks create money? Do they create money to help the Federal Reserve control the money supply or is there a more basic reason? 1.6 Suppose that the required reserve ratio is 2 percent, and you deposit $100,000 of currency into Chase Bank. What is the potential increase in deposits in the banking system brought about by your deposit? What is the potential change in the money supply?

Suppose First Main Street Bank, Second Republic Bank, and Third Fidelity Bank all have zero excess reserves. The required reserve ratio is 10%. Paolo, a client of First Main Street Bank, deposits $500,000 into his checking account at First Main Street Bank. Complete the following table to reflect any changes in First Main Street Bank's T-account (before the bank makes any new loans). Assets Liabilities                       Complete the following table to show the effect of a new deposit on excess and required reserves when the required reserve ratio is 10%. Hint: If the change is negative, be sure to enter the value as negative number. Amount Deposited Change in Excess Reserves Change in Required Reserves (Dollars) (Dollars) (Dollars) 500,000         Now, suppose First Main Street Bank loans out all of its new excess reserves to Lucia, who immediately uses the funds to write a check to Kenji. Kenji deposits the funds immediately into…

Assuming a bank only keeps enough of its reserves to meet its reserve requirement, how much money is created after the Federal Reserve purchases $40,000 worth of bonds from a bank (this means they deposit $40,000 in that bank's reserve account) and there is a 25% reserve requirement? Hint: enter your answer without a comma or $ sign. Example: if the answer is $44,000 enter 44000 as your answer. Show Transcribed Text Assuming a bank only keeps enough of its reserves to meet its reserve requirement, how much money is created when a bank receives a deposit from an individual of $60,000 and there is a 10% reserve requirement. Hint: enter your answer without a comma or $ sign. Example: if the answer is $44,000 enter 44000 as your answer.

If the required reserve ratio is 12.5%, and Elon Musk has deposited $5 billion cash to his bank account. What happens to the money supply in the economy? A) nothing happens in money supply since both cash and bank deposits are money anyway. B) Money supply increases by $50 billion. C) Money supply increases by $40 billion. D) Money supply increases by $35 billion.