Assume that the banking system has total reserves of $360 billion. Assume also that required reserves are 24 percent and that banks do not hold any excess reserves and households hold no currency. Now suppose that the Fed increased the required reserves to 28.8 . What is the level of excess reserves? Make sure to include a negative sign if necessary. Hint Incorrect. Assume that the banking system has total reserves of $870 billion. Assume also that required reserves are 29 percent and that banks do not hold any excess reserves and households hold no currency. Now suppose that the Fed increased the required reserves to 34.8 . As a result of this new policy, by how much has the money supply changed? Hint