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Hello, please help me with this (the drop arrows and blank boxes), I continue to them it incorrect. 5. The money creation process Suppose 7rst
Hello, please help me with this (the drop arrows and blank boxes), I continue to them it incorrect.
5. The money creation process Suppose 7rst Main Street Bank, Second Republic Sank, and Third Fidelity Sank all have zero excess reserves. The required reserve ratio is 20%. Gilberto, a client of First Main Street Bank, deposits into his checking account at First Main Street Bank. Photos - 5JPG See all photos Complete the following table to reflect any changes .in First Marn Street Bank's T-sccount (before the bank makes any new loans). + Add to Choices for the drop arrow lines are as follows: Liabilities Building and filrniture, or Deposits, or Loans, or Net Wolth, or Reserves. $300,000, or or or pygpJ_ Building and fiarniture, or Deposits, or Loans, or Net Worth, or Reserves. $300,000, or or or Complete the following table to show the effect of new deposit on excess and required reserves when the required reserve rstjo is 2004 $750,000, or or Hint: If the change is negative, be sure to enter the value as negative number. Amount Deposited Change in Excess Reserves Change in Required Reserves (Dollars) (Dollars) Now, suppose First Main Street Bank loans out all of its new excess resen.'es to Dina, who immediately uses the funds to write a check to Charles. Charles deposits the funds immediately into his checking accNnt at Second Republic Sank. Then Second Republic Sank lends out all of its new excess reserves to Lorenzo, who writes a check to Juanita, who deposits the money into her account at Third Fidelity Sank. Third Fidelity lends out all of its new excess reserves to Neha in turn. Fill in the fr]/owing table to show the effect of this ongoing chain of events st each bank. Enter each answer to the nearest dollar. Increase in Deposits (Do Ilars) First Main Street Bank Second Republic Bank Third Fidelity Bank Increase in Required Reserves (Dollars) Increase in Loans (Dollars) Assume this process continues, with each successive loan deposited into a checking account and no banks keeping any excess reserves. Under these assumptions, the injection into the money supply results in an overall increase of lv in demand deposits.
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