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5. Suppose the Fed makes an open market purchase of $1,000,000 of securities and required reserves ratio is 0.1, how much the quantity of money
5. Suppose the Fed makes an open market purchase of $1,000,000 of securities and required reserves ratio is 0.1, how much the quantity of money changes? (10 points) (See PPT Macro chll lecture or pages 272-273) a. If actual reserves ratio equals required reserves ratio and currency drain ratio is 0.2. (5 points) b. If actual reserves ratio equals 0.12 and currency drain ratio is 0.28. (5 points)
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