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A bank that has liabilities of $160 billion and a net worth of $30 billion must have? hint, assets worth a certain number, or excess

  1. A bank that has liabilities of $160 billion and a net worth of $30 billion must have? hint, assets worth a certain number, or excess reserves or reserves.
  2. If nominal GDP is $800 billion and, on average, each dollar is spent five times in the economy over a year, then the quantity of money demanded for transactions purposes will be?
  3. Answer the question based on the following information for a bond having no expiration date: bond price = $1,000; bond fixed annual interest payment = $100; bond annual interest rate = 10 percent. If the price of this bond increases to $1,250, the interest rate will?
  4. Suppose the ABC bank has excess reserves of $2,000 and checkable deposits of $40,000. If the reserve requirement is 20 percent, what is the size of the bank's actual reserves?
  5. The price of a bond with no expiration date is originally $1,000 and has a fixed annual interest payment of $150. If the price of the bond then falls by $200, what will be the interest rate yield to a new buyer of the bond?
  6. (Advanced analysis) Assume the equation for the total demand for money isL= 0.4Y+ 80 ? 4i, whereLis the amount of money demanded,Yis gross domestic product, andiis the interest rate. If gross domestic product is $250 and the interest rate is 9 percent, what amount of money will society want to hold?
  7. Assume that Smith deposits $150 in currency into her checking account in the XYZ Bank. Later that same day, Jones negotiates a loan for $900 at the same bank. In what direction and by what amount has the supply of money changed?
  8. Suppose a commercial banking system has $100,000 of outstanding checkable deposits and actual reserves of $25,000. If the reserve ratio is 20 percent, the banking system can expand the supply of money by the maximum amount of?
  9. Question 9 image

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MC Qu. 36-271 (Algo) The table shows items... Item in Balance Sheet Amount 1) Treasury Deposits 2) Reserves of Commercial Banks 3) Federal Reserve Notes -a- The table shows items and gures taken from a consolidated balance sheet of the 12 Federal Reserve Banks. All gures are in billions of dollars. In this balance sheet, there would be assets of MC Qu. 36-253 (Algo) Refer to the graph. If... Refer to the graph. If the initial equilibrium interest rate was 5 percent and the money supply increased by $100 billion. then the new interest rate would be interest Rate D $50 100 150 200 250 300 Amount of Money Demanded (SB)

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