National Bank currently has $1,050 million in transaction deposits on its balance sheet The current reserve requirement is 12 percent, but the Federal Reserve is decreasing this requirement to 10 percent a Show the balance sheet of the Federal Reserve and National Bank if National Bank converts all excess reserves to loans, but borrowers return only 50 percent of these funds to National Bank as transaction deposits b Show the balance sheet of the Federal Reserve and National Bank if National Bank converts 90 percent of its excess reserves to loans and borrowers return 60 percent of these funds to National Bank as transaction deposits A) Show the balance sheet of the Federal Reserve and National Bank if National Bank converts all excess reserves to loans, but borrowers return only 50 percent of these funds to National Bank as transaction deposits (Enter your answers in millions Do not round intermediate calculations Round your Panel B answers to 3 decimal places (e g , 32 161)) Panel A Initial Balance Sheets Federal Reserve Bank Assets Liabilities Securities $126 million Reserve accounts $126 million National Bank Assets Liabilities Loans $924 million Transaction deposits $1,050 million Reserve deposits at Fed 126 million Panel B Balance Sheet after All Changes Federal Reserve Bank Assets Liabilities Securities $161 000 million Reserve accounts $161 000 million National Bank Assets Liabilities Loans million Transaction deposits million Reserve deposits at Fed million B) Show the balance sheet of the Federal Reserve and National Bank if National Bank converts 90 percent of its excess reserves to loans and borrowers return 60 percent of these funds to National Bank as transaction deposits (Enter your answers in millions Do not round intermediate calculations Round your Panel B answers to 3 decimal places (e g , 32 161)) Panel A Initial Balance Sheets Federal Reserve Bank Assets Liabilities Securities $126 million Reserve accounts $126 million National Bank Assets Liabilities Loans $924 million Transaction deposits $1,050 million Reserve deposits at Fed 126 million Panel B Balance Sheet after All Changes Federal Reserve Bank Assets Liabilities Securities million Reserve accounts million National Bank Assets Liabilities Loans million Transaction deposits million Reserve deposits at Fed million

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National Bank currently has $1,050 million in transaction deposits on its balance sheet. The current reserve requirement is 12 percent, but the Federal Reserve is

National Bank currently has $1,050 million in transaction deposits on its balance sheet. The current reserve requirement is 12 percent, but the Federal Reserve is decreasing this requirement to 10 percent. a. Show the balance sheet of the Federal Reserve and National Bank if National Bank converts all excess reserves to loans, but borrowers return only 50 percent of these funds to National Bank as transaction deposits. b. Show the balance sheet of the Federal Reserve and National Bank if National Bank converts 90 percent of its excess reserves to loans and borrowers return 60 percent of these funds to National Bank as transaction deposits.

Show the balance sheet of the Federal Reserve and National Bank if National Bank converts all excess reserves to loans, but borrowers return only 50 percent of these funds to National Bank as transaction deposits. (Enter your answers in millions. Do not round intermediate calculations. Round your "Panel B" answers to 3 decimal places. (e.g., 32.161))

Panel A: Initial Balance Sheets
Federal Reserve Bank
Assets			Liabilities
Securities	$126	million	Reserve accounts	$126	million

National Bank
Assets			Liabilities
Loans	$924	million	Transaction deposits	$1,050	million
Reserve deposits at Fed	126	million

Panel B: Balance Sheet after All Changes
Federal Reserve Bank
Assets			Liabilities
Securities	$161.000	million	Reserve accounts	$161.000	million

National Bank
Assets			Liabilities
Loans		million	Transaction deposits		million
Reserve deposits at Fed		million

Show the balance sheet of the Federal Reserve and National Bank if National Bank converts 90 percent of its excess reserves to loans and borrowers return 60 percent of these funds to National Bank as transaction deposits. (Enter your answers in millions. Do not round intermediate calculations. Round your "Panel B" answers to 3 decimal places. (e.g., 32.161))

Panel A: Initial Balance Sheets
Federal Reserve Bank
Assets			Liabilities
Securities	$126	million	Reserve accounts	$126	million

National Bank
Assets			Liabilities
Loans	$924	million	Transaction deposits	$1,050	million
Reserve deposits at Fed	126	million

Panel B: Balance Sheet after All Changes
Federal Reserve Bank
Assets			Liabilities
Securities		million	Reserve accounts		million

National Bank
Assets			Liabilities
Loans		million	Transaction deposits		million
Reserve deposits at Fed		million