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2. Suppose the Central Bank sells $100 worth of foreign exchange to a business person who has an account in a commercial bank. Show where

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2. Suppose the Central Bank sells $100 worth of foreign exchange to a business person who has an account in a commercial bank. Show where the $100 would appear in all three of the T- Accounts above. Use+and - to show changes. 1. Write down T-Accounts for the Central Bank a commercial bank, and the public. Place the following items in the appropriate places in the three accounts D demand deposits T time deposits L loans from cb to public Rcb reserves in the CB Curr currency in circulation GSI govt bonds held by CB GS2 govt bonds held by cb GS3 govt bonds held by public FE1 foreign exchange held by CB FE3 foreign exchange held by public CB Rt ID+ Dr IL cb public GSI R+ FEI Currency GS2 FE3 2. Suppose the Central Bank sells $100 worth of foreign exchange to a business person who has an account in a commercial bank. Show where the $100 would appear in all three of the T- Accounts above. Use + and - to show changes

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