Question
Given the following partial balance sheet for the 1st National Bank of Anywhere, please calculate the potential impact on the money supply for each of
Given the following partial balance sheet for the 1st National Bank of Anywhere, please calculate the potential impact on the money supply for each of the following changes. Analyze each change separately. Assets Liabilities Cash 100,000 DD 2,000,000 reserve ratio = 10% Dep at Fed 100,000 35. The Fed sells $50,000 of T-bills to a customer of this bank who writes a bank check to pay for the T-bill. Potential impact = _____________ 36. The Fed raises the reserve ratio to 15%. Potential Impact = ____________. 37. The Fed simultaneously buys $20,000 in T-bills from a customer of the 1st National Bank of Anywhere who then deposits the check (from the Fed) in her checking account and the Fed also lowers the reserve ratio to 5%. Potential impact = ____________.
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