3. Suppose the required reserve ratio on checkable deposits is 10%, banks do not hold any excess reserves, and the public's holdings of currency do not change*. 3.1) If the Fed lends five banks an additional total of $100 million but depositors withdraw $50 million and hold it as currency, what happens to reserves and the monetary base? Use T-accounts of the banking system, the Fed and the public to explain your answer. (5 points) 3.2) If the Feb buys $1 million of bonds from the First National Bank, but an additional 10% of any deposit is held as excess reserves, what is the total increase in checkable deposits?(5 points) *Note: Questions 3.1 and 3.2 are two separate cases