I, A new checkable deposit of $1,U0 is made in Bank I. The requited reserve ratio is 19 percent checkable deposits, and banks do not hold any excess reserves. That is, banks loan out the other 90 percent of their deposits. Assume that all money loaned out by one bank is redeposited in another bank. To see how the new deposit creates money and increases the money supply, find following values. (A) Bank I must keep required reserves = (H) Bank 1 can loan = $900 (C) When the proceeds of the loan are redeposited, Bank 2 receives new deposits = $900 (D) Bank 2 must keep additional required reserves = (B) Bank 2 can now make new loans = $810 (F) When the proceeds of the loan are redeposited, Bank 3 receives new deposits = (G) Bank 3 must keep additional required reserves - (H ) Bank 3 can now make new loans = $729