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2. Consider a bank represented by the initial balance sheet in the previous ques- tion. Suppose that the bank experiences a deposit outflow of 10.

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2. Consider a bank represented by the initial balance sheet in the previous ques- tion. Suppose that the bank experiences a deposit outflow of 10. (a) Show the new balance sheet. (b) What options are available for the bank to bank to re-establish its desired ratio of reserves-to-deposits? (c) Which option would the bank be least inclined to pursue. (d) Suppose the bank wants to hold 6 worth of securities once it returns to equilibrium. Show the balance sheet once it has returned to equilibrium, assuming it doesn't choose it's least-desirable strategy. 1. Consider a bank represented by the following balance sheet. Assets Liabilities reserves 10 deposits 100 securities 5 loans 95 Capital 10 Suppose the bank's desired ratio for reserves-to-deposits is 0.10, and suppose the bank experiences a sudden deposit inflow of 10. (a) Show the new balance sheet. (b) How will the bank react to the inflow. Show the balance sheet once the bank has returned to equilibrium

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