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Monetary Policy: Open Market Operations The above balance sheets belong to two banks (the numbers are in $million). Assume these are the only banks in
Monetary Policy: Open Market Operations The above balance sheets belong to two banks (the numbers are in $million). Assume these are the only banks in the country. No one in this country holds cash. Abigail has an account at Bank A and Brad at Bank B. The Fed conducts an open market purchase of $30 million. Here are the sellers: Bank A sells $10 million worth of bonds. Bank B sells $15 million worth of bonds. Abigail sells $3 million worth of bonds. Brad sells $2 million worth of bonds. Let's calculate the values of the balance sheet entries after this expansionary monetary policy
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