Assume that the banking system has total reserves of $544 billion. Assume also that required reserves are 34 percent and that banks do not hold any excess reserves and households hold no currency. Now suppose that the Fed decreases the required reserves to 27.2. What is the level of excess reserves? Make sure to include a negative sign if necessary. Hint Assume that the banking system has total reserves of $525 billion. Assume also that required reserves are 25 percent and that banks do not hold any excess reserves and households hold no currency. Now suppose that the Fed decreased the required reserves to 20 . As a result of this new policy, by how much has the money supply increased? Hint Assume that the banking system has total reserves of $221 billion. Assume also that required reserves are 17 percent and that banks do not hold any excess reserves and households hold no currency. What is money multiplier? Hint