1. Eli has $5000 in cash and decides that he needs to open a checking account at Main Street

Bank.

ASSETS LIABILITIES

Required Reserves

Excess Reserves

Loans

Checkable Deposits

2. Melanie's Furniture Mart seeks a loan from Main Street Bank. The bank loans Melanie the

maximum amount they can loan out.

ASSETS LIABILITIES

Required Reserves

Excess Reserves

Loans

Checkable Deposits

3. Melanie deposits the money she borrowed into her account at Main Street Bank.

ASSETS LIABILITIES

Required Reserves

Excess Reserves

Loans

Checkable Deposits

4. Sean wants to buy new living room furniture for his home. Main Street Bank loans Sean the

maximum amount it can loan out.

ASSETS LIABILITIES

Required Reserves

Excess Reserves

Loans

Checkable Deposits

5. Sean buys the furniture from Melanie's Furniture Mart and Melanie deposits the money in

her account at Main Street Bank.

ASSETS LIABILITIES

Required Reserves

Excess Reserves

Loans

Checkable Deposits

6. How much has the bank created with these transactions?