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2. Identify the consequences for bank reserves (R) and the money supply (M) for each of the following transactions. Use the appropriate T-accounts to construct your answers. (a) The Federal Reserve purchases $1B in U.S. Treasury Bills on the open market (b) The U.S. Treasury sells $1B in 5-year notes and deposits the $1B in its account at the Federal Reserve. (c) The Federal Reserve borrows $1B worth of Japanese yen and sells the yen to foreign exchange dealers for $1B. (d) The Federal Reserve makes a $1B emergency discount loan to a private bank that is experiencing withdrawals due to a sizable loan it made to a business which files for bankruptcy; at the same time the Federal Reserve sells $1B in Treasury bills. 2. Identify the consequences for bank reserves (R) and the money supply (M) for each of the following transactions. Use the appropriate T-accounts to construct your answers. (a) The Federal Reserve purchases $1B in U.S. Treasury Bills on the open market (b) The U.S. Treasury sells $1B in 5-year notes and deposits the $1B in its account at the Federal Reserve. (c) The Federal Reserve borrows $1B worth of Japanese yen and sells the yen to foreign exchange dealers for $1B. (d) The Federal Reserve makes a $1B emergency discount loan to a private bank that is experiencing withdrawals due to a sizable loan it made to a business which files for bankruptcy; at the same time the Federal Reserve sells $1B in Treasury bills