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Below is the simplified balance sheet of Gorgonzolan commercial banks at some point in time. Amount 200,000 Amount 600,000 400,000 Assets Currency (= reserves)
Below is the simplified balance sheet of Gorgonzolan commercial banks at some point in time. Amount 200,000 Amount 600,000 400,000 Assets Currency (= reserves) Loans Assume that the Gorgonzolan commercial banks desire to hold reserves of 25 percent of deposits and that the public holds no currency long term. Assets Currency Final value of bank. reserves Instructions: Enter your responses as whole numbers. a. Given the data in the balance sheet, the Gorgonzolan commercial banks want to hold b. The Gorgonzolan commercial banks currently have in extra reserves that they would like to lend out. c. Assuming that no additional reserves enter the Gorgonzolan banking system, the final values of bank reserves, loans, and deposits are: Final consolidated balance sheet Loans Liabilities Deposits d. The final value of the money supply is: Amount Liabilities Deposits guilders. Amount in reserves.
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