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Hello I dont know how to solve this question Suppose that a bank is starting from scratch and has no reserves, has made no loans,

Hello I dont know how to solve this question

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Suppose that a bank is starting from scratch and has no reserves, has made no loans, and has no checking deposits. Thus, both the asset and liability sides of the balance sheet are zero. Jack has $100 in his pocket, and the reserve requirement is 20%. Recall, M0 = Cash* + Reserves ["Monetary Base\"] M1 = Total Deposits + Cash* [\"Money Supply\"] *held by the public a. Jack deposits the $100 in his pocket. Write-down the bank's balance sheet after this deposit. What is M0 and M1? What is M1? b. Assume that the bank decides to hold the minimum amount of reserves, and loans out the rest to another resident in town, Karly. Write down the bank's balance sheet after this deposit. What is MO and M1? How has M0 and M1 changed relative to part (a)

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