1.You are given the following balance sheet of the Summer Bank

Balance sheet of the Summer bank

Assets Liabilities

Cash$ 8,000

Deposited with the Fed$ 6,000

Loans$ 136,000 Deposits$ 90,000

Capital$ 60,000

Total$ 150,000 Total$ 150,000

The required reserve ratio (RRR) on all deposits is 10%

1.What, if any, are this bank's excess reserves?

2.How much new amount of loan will this bank be able to create because of the excess reserves?

3.How much new amount of loan the entire banking system be able to create because of the excess reserves?

4.What would be the excess reserves of this bank after the RRR is changed to 8%?

5.How much new amount of loan will this bank be able to create with the RRR of 8%?

6.How much new amount of loan the entire banking system be able to create because of the excess reserves?