6. (This question follows Q5.) Use the following notation: C is currency in circulation

outside banks, R is bank reserves, D is deposits, L is loans, MB is the monetary base, M is

total money supply, r is the required reserve ratio, and c is the currency-to-deposit ratio.

Assume c = 0.05 and r = 0.2. Suppose all commercial banks hold zero excess reserves.

Following the $5 million open market purchase, what will be the change of C, R, D, L, MB

and M after the money supply process is completed? Calculate:

m = ________________________

C = _______________________

R = _______________________

D = _______________________

L = _______________________

MB = _____________________

M = ______________________