Question
Consider that there is only one bank and its balance sheet is as follows Use it to answer the next 5 questions. Assets Liabilities Reserves
Consider that there is only one bank and its balance sheet is as follows Use it to answer the next 5 questions. Assets Liabilities Reserves $26,000 Demand Deposits $160,000 Loans $134,000 Let rrD = 10%, e= 5% and c=10%. 92. What is the value of this banks undesired excess reserves? a. +$13,000 b. +$5,000 c. +$2,000 d. -$4,000 e. -$15,000 93. What is the value of the money multiplier for this problem? a. 10 b. 5.5 c. 5.0 d. 4.4 e. 4.0 94. At the outset of this problem, what is the level of the money supply (M1)? a. $125,000 b. $160,000 c. $176,000 d. $242,000 e. $320,000 95. In order to reach a final equilibrium, the money supply will have to change by: a. +$2,000 b. +$8,800 c. +$26,000 d. +$71,500 e. -$71,500 96. At the final equilibrium, the value of the undesired excess reserves will be: a. +$2,000 b. +$1,000 c. -$2,000 d. -$8,000 e. None of the above.
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