SlideShare a Scribd company logo
1 of 1
Download to read offline
You were given this balance sheet for a bank.
Assets. Liabilities.
Reserves $200 Deposits $2000
Loans $1800
The required reserve ratio is 10%
A. How much is its excess reserves?
B. Suppose Ms. A deposits $1000 to her account at the bank. Show the effect of this transaction
on the banks balance sheet. How much is its excess reserves after the transaction?
C. How much will M1 increase when the money creation process (involving the whole banking
sector, and the general public) from the loan making of this bank (using its excess reserves from
part (b))

More Related Content

More from amie1085

_______ es m�s probable que se subcontrate al mejor postor. Habili.pdf
_______ es m�s probable que se subcontrate al mejor postor. Habili.pdf_______ es m�s probable que se subcontrate al mejor postor. Habili.pdf
_______ es m�s probable que se subcontrate al mejor postor. Habili.pdfamie1085
 
[10pts] Show that i=0ni!ei=n!1uneu�du.pdf
[10pts] Show that i=0ni!ei=n!1uneu�du.pdf[10pts] Show that i=0ni!ei=n!1uneu�du.pdf
[10pts] Show that i=0ni!ei=n!1uneu�du.pdfamie1085
 
Zoom el desaf�o de escalar con COVID-19 en el horizonte Serie de .pdf
Zoom el desaf�o de escalar con COVID-19 en el horizonte Serie de .pdfZoom el desaf�o de escalar con COVID-19 en el horizonte Serie de .pdf
Zoom el desaf�o de escalar con COVID-19 en el horizonte Serie de .pdfamie1085
 
Zero trust is a security stance for networking based on not trusting.pdf
Zero trust is a security stance for networking based on not trusting.pdfZero trust is a security stance for networking based on not trusting.pdf
Zero trust is a security stance for networking based on not trusting.pdfamie1085
 
Zeynep, ABD�de mezuniyetini kutlamak ve bahar tatili i�in Meksika� ya .pdf
Zeynep, ABD�de mezuniyetini kutlamak ve bahar tatili i�in Meksika� ya .pdfZeynep, ABD�de mezuniyetini kutlamak ve bahar tatili i�in Meksika� ya .pdf
Zeynep, ABD�de mezuniyetini kutlamak ve bahar tatili i�in Meksika� ya .pdfamie1085
 
Zara es la cadena principal del minorista de ropa del Grupo Inditex,.pdf
Zara es la cadena principal del minorista de ropa del Grupo Inditex,.pdfZara es la cadena principal del minorista de ropa del Grupo Inditex,.pdf
Zara es la cadena principal del minorista de ropa del Grupo Inditex,.pdfamie1085
 
Z0.975=1.96 What does the 0.975 represent What does the 1.96 repr.pdf
Z0.975=1.96 What does the 0.975 represent What does the 1.96 repr.pdfZ0.975=1.96 What does the 0.975 represent What does the 1.96 repr.pdf
Z0.975=1.96 What does the 0.975 represent What does the 1.96 repr.pdfamie1085
 
y^=2.5+22x Using least-squares regression, the forecast for the number.pdf
y^=2.5+22x Using least-squares regression, the forecast for the number.pdfy^=2.5+22x Using least-squares regression, the forecast for the number.pdf
y^=2.5+22x Using least-squares regression, the forecast for the number.pdfamie1085
 
Your task is to implement an informed search algorithm that will cal.pdf
Your task is to implement an informed search algorithm that will cal.pdfYour task is to implement an informed search algorithm that will cal.pdf
Your task is to implement an informed search algorithm that will cal.pdfamie1085
 
You have been at an industry trade show in Toronto all week. At the .pdf
You have been at an industry trade show in Toronto all week. At the .pdfYou have been at an industry trade show in Toronto all week. At the .pdf
You have been at an industry trade show in Toronto all week. At the .pdfamie1085
 
Your assignment is to research and investigate the Watergate Break I.pdf
Your assignment is to research and investigate the Watergate Break I.pdfYour assignment is to research and investigate the Watergate Break I.pdf
Your assignment is to research and investigate the Watergate Break I.pdfamie1085
 
You have a patient, Janet, that has screening for her son, Julian, t.pdf
You have a patient, Janet, that has screening for her son, Julian, t.pdfYou have a patient, Janet, that has screening for her son, Julian, t.pdf
You have a patient, Janet, that has screening for her son, Julian, t.pdfamie1085
 
You work as the IT administrator for a small business and are respon.pdf
You work as the IT administrator for a small business and are respon.pdfYou work as the IT administrator for a small business and are respon.pdf
You work as the IT administrator for a small business and are respon.pdfamie1085
 
You have a dataset that consists of the following columns- client.pdf
You have a dataset that consists of the following columns- client.pdfYou have a dataset that consists of the following columns- client.pdf
You have a dataset that consists of the following columns- client.pdfamie1085
 
You paid $10 to be entered into a raffle for a prize of $1,000. If .pdf
You paid $10 to be entered into a raffle for a prize of $1,000.  If .pdfYou paid $10 to be entered into a raffle for a prize of $1,000.  If .pdf
You paid $10 to be entered into a raffle for a prize of $1,000. If .pdfamie1085
 
You identify a pin1ui mutant with a pin1 gene that cannot be induced.pdf
You identify a pin1ui mutant with a pin1 gene that cannot be induced.pdfYou identify a pin1ui mutant with a pin1 gene that cannot be induced.pdf
You identify a pin1ui mutant with a pin1 gene that cannot be induced.pdfamie1085
 
You immunize an H2k mouse with chicken ovalbumin (a protein against .pdf
You immunize an H2k mouse with chicken ovalbumin (a protein against .pdfYou immunize an H2k mouse with chicken ovalbumin (a protein against .pdf
You immunize an H2k mouse with chicken ovalbumin (a protein against .pdfamie1085
 

More from amie1085 (17)

_______ es m�s probable que se subcontrate al mejor postor. Habili.pdf
_______ es m�s probable que se subcontrate al mejor postor. Habili.pdf_______ es m�s probable que se subcontrate al mejor postor. Habili.pdf
_______ es m�s probable que se subcontrate al mejor postor. Habili.pdf
 
[10pts] Show that i=0ni!ei=n!1uneu�du.pdf
[10pts] Show that i=0ni!ei=n!1uneu�du.pdf[10pts] Show that i=0ni!ei=n!1uneu�du.pdf
[10pts] Show that i=0ni!ei=n!1uneu�du.pdf
 
Zoom el desaf�o de escalar con COVID-19 en el horizonte Serie de .pdf
Zoom el desaf�o de escalar con COVID-19 en el horizonte Serie de .pdfZoom el desaf�o de escalar con COVID-19 en el horizonte Serie de .pdf
Zoom el desaf�o de escalar con COVID-19 en el horizonte Serie de .pdf
 
Zero trust is a security stance for networking based on not trusting.pdf
Zero trust is a security stance for networking based on not trusting.pdfZero trust is a security stance for networking based on not trusting.pdf
Zero trust is a security stance for networking based on not trusting.pdf
 
Zeynep, ABD�de mezuniyetini kutlamak ve bahar tatili i�in Meksika� ya .pdf
Zeynep, ABD�de mezuniyetini kutlamak ve bahar tatili i�in Meksika� ya .pdfZeynep, ABD�de mezuniyetini kutlamak ve bahar tatili i�in Meksika� ya .pdf
Zeynep, ABD�de mezuniyetini kutlamak ve bahar tatili i�in Meksika� ya .pdf
 
Zara es la cadena principal del minorista de ropa del Grupo Inditex,.pdf
Zara es la cadena principal del minorista de ropa del Grupo Inditex,.pdfZara es la cadena principal del minorista de ropa del Grupo Inditex,.pdf
Zara es la cadena principal del minorista de ropa del Grupo Inditex,.pdf
 
Z0.975=1.96 What does the 0.975 represent What does the 1.96 repr.pdf
Z0.975=1.96 What does the 0.975 represent What does the 1.96 repr.pdfZ0.975=1.96 What does the 0.975 represent What does the 1.96 repr.pdf
Z0.975=1.96 What does the 0.975 represent What does the 1.96 repr.pdf
 
y^=2.5+22x Using least-squares regression, the forecast for the number.pdf
y^=2.5+22x Using least-squares regression, the forecast for the number.pdfy^=2.5+22x Using least-squares regression, the forecast for the number.pdf
y^=2.5+22x Using least-squares regression, the forecast for the number.pdf
 
Your task is to implement an informed search algorithm that will cal.pdf
Your task is to implement an informed search algorithm that will cal.pdfYour task is to implement an informed search algorithm that will cal.pdf
Your task is to implement an informed search algorithm that will cal.pdf
 
You have been at an industry trade show in Toronto all week. At the .pdf
You have been at an industry trade show in Toronto all week. At the .pdfYou have been at an industry trade show in Toronto all week. At the .pdf
You have been at an industry trade show in Toronto all week. At the .pdf
 
Your assignment is to research and investigate the Watergate Break I.pdf
Your assignment is to research and investigate the Watergate Break I.pdfYour assignment is to research and investigate the Watergate Break I.pdf
Your assignment is to research and investigate the Watergate Break I.pdf
 
You have a patient, Janet, that has screening for her son, Julian, t.pdf
You have a patient, Janet, that has screening for her son, Julian, t.pdfYou have a patient, Janet, that has screening for her son, Julian, t.pdf
You have a patient, Janet, that has screening for her son, Julian, t.pdf
 
You work as the IT administrator for a small business and are respon.pdf
You work as the IT administrator for a small business and are respon.pdfYou work as the IT administrator for a small business and are respon.pdf
You work as the IT administrator for a small business and are respon.pdf
 
You have a dataset that consists of the following columns- client.pdf
You have a dataset that consists of the following columns- client.pdfYou have a dataset that consists of the following columns- client.pdf
You have a dataset that consists of the following columns- client.pdf
 
You paid $10 to be entered into a raffle for a prize of $1,000. If .pdf
You paid $10 to be entered into a raffle for a prize of $1,000.  If .pdfYou paid $10 to be entered into a raffle for a prize of $1,000.  If .pdf
You paid $10 to be entered into a raffle for a prize of $1,000. If .pdf
 
You identify a pin1ui mutant with a pin1 gene that cannot be induced.pdf
You identify a pin1ui mutant with a pin1 gene that cannot be induced.pdfYou identify a pin1ui mutant with a pin1 gene that cannot be induced.pdf
You identify a pin1ui mutant with a pin1 gene that cannot be induced.pdf
 
You immunize an H2k mouse with chicken ovalbumin (a protein against .pdf
You immunize an H2k mouse with chicken ovalbumin (a protein against .pdfYou immunize an H2k mouse with chicken ovalbumin (a protein against .pdf
You immunize an H2k mouse with chicken ovalbumin (a protein against .pdf
 

Recently uploaded

Separation of Lanthanides/ Lanthanides and Actinides
Separation of Lanthanides/ Lanthanides and ActinidesSeparation of Lanthanides/ Lanthanides and Actinides
Separation of Lanthanides/ Lanthanides and ActinidesFatimaKhan178732
 
A Critique of the Proposed National Education Policy Reform
A Critique of the Proposed National Education Policy ReformA Critique of the Proposed National Education Policy Reform
A Critique of the Proposed National Education Policy ReformChameera Dedduwage
 
Web & Social Media Analytics Previous Year Question Paper.pdf
Web & Social Media Analytics Previous Year Question Paper.pdfWeb & Social Media Analytics Previous Year Question Paper.pdf
Web & Social Media Analytics Previous Year Question Paper.pdfJayanti Pande
 
1029-Danh muc Sach Giao Khoa khoi 6.pdf
1029-Danh muc Sach Giao Khoa khoi  6.pdf1029-Danh muc Sach Giao Khoa khoi  6.pdf
1029-Danh muc Sach Giao Khoa khoi 6.pdfQucHHunhnh
 
Privatization and Disinvestment - Meaning, Objectives, Advantages and Disadva...
Privatization and Disinvestment - Meaning, Objectives, Advantages and Disadva...Privatization and Disinvestment - Meaning, Objectives, Advantages and Disadva...
Privatization and Disinvestment - Meaning, Objectives, Advantages and Disadva...RKavithamani
 
Activity 01 - Artificial Culture (1).pdf
Activity 01 - Artificial Culture (1).pdfActivity 01 - Artificial Culture (1).pdf
Activity 01 - Artificial Culture (1).pdfciinovamais
 
How to Make a Pirate ship Primary Education.pptx
How to Make a Pirate ship Primary Education.pptxHow to Make a Pirate ship Primary Education.pptx
How to Make a Pirate ship Primary Education.pptxmanuelaromero2013
 
Grant Readiness 101 TechSoup and Remy Consulting
Grant Readiness 101 TechSoup and Remy ConsultingGrant Readiness 101 TechSoup and Remy Consulting
Grant Readiness 101 TechSoup and Remy ConsultingTechSoup
 
Accessible design: Minimum effort, maximum impact
Accessible design: Minimum effort, maximum impactAccessible design: Minimum effort, maximum impact
Accessible design: Minimum effort, maximum impactdawncurless
 
Software Engineering Methodologies (overview)
Software Engineering Methodologies (overview)Software Engineering Methodologies (overview)
Software Engineering Methodologies (overview)eniolaolutunde
 
microwave assisted reaction. General introduction
microwave assisted reaction. General introductionmicrowave assisted reaction. General introduction
microwave assisted reaction. General introductionMaksud Ahmed
 
Introduction to ArtificiaI Intelligence in Higher Education
Introduction to ArtificiaI Intelligence in Higher EducationIntroduction to ArtificiaI Intelligence in Higher Education
Introduction to ArtificiaI Intelligence in Higher Educationpboyjonauth
 
Beyond the EU: DORA and NIS 2 Directive's Global Impact
Beyond the EU: DORA and NIS 2 Directive's Global ImpactBeyond the EU: DORA and NIS 2 Directive's Global Impact
Beyond the EU: DORA and NIS 2 Directive's Global ImpactPECB
 
Q4-W6-Restating Informational Text Grade 3
Q4-W6-Restating Informational Text Grade 3Q4-W6-Restating Informational Text Grade 3
Q4-W6-Restating Informational Text Grade 3JemimahLaneBuaron
 
Hybridoma Technology ( Production , Purification , and Application )
Hybridoma Technology  ( Production , Purification , and Application  ) Hybridoma Technology  ( Production , Purification , and Application  )
Hybridoma Technology ( Production , Purification , and Application ) Sakshi Ghasle
 
1029 - Danh muc Sach Giao Khoa 10 . pdf
1029 -  Danh muc Sach Giao Khoa 10 . pdf1029 -  Danh muc Sach Giao Khoa 10 . pdf
1029 - Danh muc Sach Giao Khoa 10 . pdfQucHHunhnh
 
Z Score,T Score, Percential Rank and Box Plot Graph
Z Score,T Score, Percential Rank and Box Plot GraphZ Score,T Score, Percential Rank and Box Plot Graph
Z Score,T Score, Percential Rank and Box Plot GraphThiyagu K
 
URLs and Routing in the Odoo 17 Website App
URLs and Routing in the Odoo 17 Website AppURLs and Routing in the Odoo 17 Website App
URLs and Routing in the Odoo 17 Website AppCeline George
 

Recently uploaded (20)

Separation of Lanthanides/ Lanthanides and Actinides
Separation of Lanthanides/ Lanthanides and ActinidesSeparation of Lanthanides/ Lanthanides and Actinides
Separation of Lanthanides/ Lanthanides and Actinides
 
A Critique of the Proposed National Education Policy Reform
A Critique of the Proposed National Education Policy ReformA Critique of the Proposed National Education Policy Reform
A Critique of the Proposed National Education Policy Reform
 
Web & Social Media Analytics Previous Year Question Paper.pdf
Web & Social Media Analytics Previous Year Question Paper.pdfWeb & Social Media Analytics Previous Year Question Paper.pdf
Web & Social Media Analytics Previous Year Question Paper.pdf
 
1029-Danh muc Sach Giao Khoa khoi 6.pdf
1029-Danh muc Sach Giao Khoa khoi  6.pdf1029-Danh muc Sach Giao Khoa khoi  6.pdf
1029-Danh muc Sach Giao Khoa khoi 6.pdf
 
Privatization and Disinvestment - Meaning, Objectives, Advantages and Disadva...
Privatization and Disinvestment - Meaning, Objectives, Advantages and Disadva...Privatization and Disinvestment - Meaning, Objectives, Advantages and Disadva...
Privatization and Disinvestment - Meaning, Objectives, Advantages and Disadva...
 
Activity 01 - Artificial Culture (1).pdf
Activity 01 - Artificial Culture (1).pdfActivity 01 - Artificial Culture (1).pdf
Activity 01 - Artificial Culture (1).pdf
 
How to Make a Pirate ship Primary Education.pptx
How to Make a Pirate ship Primary Education.pptxHow to Make a Pirate ship Primary Education.pptx
How to Make a Pirate ship Primary Education.pptx
 
Staff of Color (SOC) Retention Efforts DDSD
Staff of Color (SOC) Retention Efforts DDSDStaff of Color (SOC) Retention Efforts DDSD
Staff of Color (SOC) Retention Efforts DDSD
 
Grant Readiness 101 TechSoup and Remy Consulting
Grant Readiness 101 TechSoup and Remy ConsultingGrant Readiness 101 TechSoup and Remy Consulting
Grant Readiness 101 TechSoup and Remy Consulting
 
Accessible design: Minimum effort, maximum impact
Accessible design: Minimum effort, maximum impactAccessible design: Minimum effort, maximum impact
Accessible design: Minimum effort, maximum impact
 
Mattingly "AI & Prompt Design: The Basics of Prompt Design"
Mattingly "AI & Prompt Design: The Basics of Prompt Design"Mattingly "AI & Prompt Design: The Basics of Prompt Design"
Mattingly "AI & Prompt Design: The Basics of Prompt Design"
 
Software Engineering Methodologies (overview)
Software Engineering Methodologies (overview)Software Engineering Methodologies (overview)
Software Engineering Methodologies (overview)
 
microwave assisted reaction. General introduction
microwave assisted reaction. General introductionmicrowave assisted reaction. General introduction
microwave assisted reaction. General introduction
 
Introduction to ArtificiaI Intelligence in Higher Education
Introduction to ArtificiaI Intelligence in Higher EducationIntroduction to ArtificiaI Intelligence in Higher Education
Introduction to ArtificiaI Intelligence in Higher Education
 
Beyond the EU: DORA and NIS 2 Directive's Global Impact
Beyond the EU: DORA and NIS 2 Directive's Global ImpactBeyond the EU: DORA and NIS 2 Directive's Global Impact
Beyond the EU: DORA and NIS 2 Directive's Global Impact
 
Q4-W6-Restating Informational Text Grade 3
Q4-W6-Restating Informational Text Grade 3Q4-W6-Restating Informational Text Grade 3
Q4-W6-Restating Informational Text Grade 3
 
Hybridoma Technology ( Production , Purification , and Application )
Hybridoma Technology  ( Production , Purification , and Application  ) Hybridoma Technology  ( Production , Purification , and Application  )
Hybridoma Technology ( Production , Purification , and Application )
 
1029 - Danh muc Sach Giao Khoa 10 . pdf
1029 -  Danh muc Sach Giao Khoa 10 . pdf1029 -  Danh muc Sach Giao Khoa 10 . pdf
1029 - Danh muc Sach Giao Khoa 10 . pdf
 
Z Score,T Score, Percential Rank and Box Plot Graph
Z Score,T Score, Percential Rank and Box Plot GraphZ Score,T Score, Percential Rank and Box Plot Graph
Z Score,T Score, Percential Rank and Box Plot Graph
 
URLs and Routing in the Odoo 17 Website App
URLs and Routing in the Odoo 17 Website AppURLs and Routing in the Odoo 17 Website App
URLs and Routing in the Odoo 17 Website App
 

You were given this balance sheet for a bank. Assets. .pdf

  • 1. You were given this balance sheet for a bank. Assets. Liabilities. Reserves $200 Deposits $2000 Loans $1800 The required reserve ratio is 10% A. How much is its excess reserves? B. Suppose Ms. A deposits $1000 to her account at the bank. Show the effect of this transaction on the banks balance sheet. How much is its excess reserves after the transaction? C. How much will M1 increase when the money creation process (involving the whole banking sector, and the general public) from the loan making of this bank (using its excess reserves from part (b))