For each of the following, draw a supply and demand diagram for the overnight interest rate. Also, provide a brief written explanation of your answer and what will happen to the overnight interest rate, non-borrowed reserves, and total reserves.

a) Currently the equilibrium overnight rate is 4% and there is $0 in borrowed reserves, $10 in total reserves. The rate the Central Bank charges for overnight loans is 5% and pays 4% for reserves. Show what will happen if the economy booms.

b) Currently the equilibrium overnight rate is 3% and there is $0 in borrowed reserves, $10 in total reserves. The rate the Central Bank charges for overnight loans is 3% and it pays 3% on reserves. Show what will happen if the Fed sells $1 in bonds to banks.

c) Currently the equilibrium overnight rate is 4% and there is $5 in borrowed reserves, and $10 in total reserves. The rate the Central Bank charges for overnight loans is 4%. The Central Bank also pays 3% on any deposits banks keep at the Central Bank. Show what happens if they lower the rate the Central Bank charges for overnight loans to 3.5%.