8 points

QUESTION 2

People hold $556 million of bank deposits but no currency. Banks have made $352 million dollars of loans and are fully loaned up. If now the banks choose to hold $20 million more in reserves, by how many millions would bank loans fall if the Fed takes no action at all?

Round your answer to 2 decimal places. Do not include the unit of measurement in your answer. For example, if your answer is 1.23 millions, type 1.23 in the box, not 1,230,000.