Question
At the Wize Bank, the required reserve ratio is 10% and Wise Bank holds 10% of excess reserves because they may want to buy bonds
At the Wize Bank, the required reserve ratio is 10% and Wise Bank holds 10% of excess reserves because they may want to buy bonds next month.
Mort deposits $1,000 from selling Pokemon cards into his checking account at Wise Bank. Based on this transaction,
(a) What is the immediate change in the Money Supply? Explain
(b) What is the total change in Demand Deposits in the Banking System?
(c) What is the maximum change in the Money Supply?
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Introduction to Econometrics
Authors: James H. Stock, Mark W. Watson
3rd edition
133595420, 978-0138009007, 138009007, 978-0133486872, 133486877, 978-0133595420
